Help To Buy ISA – Are You Eligible?
A Help to Buy ISA is a great way to get onto the property ladder. It involves saving money into a specialist ISA. For every £200 you put in, the government will give you a £50 bonus. The total bonus you can get is £3,000. The bonus funds are released after completion so don’t rely on them to make up your deposit.
Not everyone can get a Help to Buy ISA, however, plus there are rules regarding whether or not you will get the bonus. Here’s what you need to know:
The Help to Buy ISA scheme is only for first-time buyers. If you have ever owned a property before anywhere in the world, you won’t be able to open an account. If you open an account as a first-time buyer but then purchase another property in the interim, you won’t get the government bonus to purchase a second property.
You must also be a UK resident and be over 16-years-old.
Active cash ISA
You can’t have a cash ISA if you want to open a Help to Buy ISA account. Whether this applies to you depends on when you last paid money into the cash ISA. Even if it does apply to you, there are ways you can move and transfer money to make you eligible. A financial or mortgage adviser can help you with this process and give you advice based on your personal circumstances.
House price and mortgage
The home you buy must cost less than £250,000 or £450,000 if it is in London. The house you buy must also be purchased with a mortgage and be in the UK.
Buying and renting
Another rule is that you must live in the house you are buying and you cannot rent the house out. The government can make you pay the bonus back if you do this and are caught.
So long as you meet the criteria, it is worth looking at getting a Help to Buy ISA. For quality mortgage advice, please contact us at Fox Davidson today.