Published on: November 15, 2019

Welcome to the weekend from Martin! Andrew has spent much of this week on the road and I’ve grabbed the opportunity to put together this week’s News, Views and Truths with both hands, albeit gloved hands, seeing as this week has meant moving the de-icer from the garage to the car for the next few months!

The opportunity to open a Help to Buy ISA comes to a premature end on 30 November – a day before their fourth anniversary (fruit & flowers anniversary if you ever find yourself on a quiz show). No accounts can be opened after that date, although benefits still apply for accounts opened on or before the deadline. They have been unloved and short-lived in my opinion, because the contribution rules are more complex than the ‘original’ ISAs, which are a resounding success, in part because they are easily understood!

Help to Buy ISAs are not without merit and a prospective first-time buyer could consider the option of opening an account with as little as £1, leaving the door open for future contributions. The aim of the Help to Buy ISA is to save towards a deposit for a first home.  To qualify for the government’s 25% bonus, you need to save a minimum of £1,600, this would provide a £400 bonus. The maximum government bonus payable is £3,000, on balances of £12,000 and above.

You can save up to a maximum of £200 per month, with an additional allowance of £1,000 in the first calendar month. This is available for each buyer, not the house. So, if buying with a partner you could reap the rewards of up to £6,000 towards the deposit.

Account applicants must be 16 or over, never having owned a property in UK or abroad and can use the Help to Buy savings and bonus to buy any home up to £250,000 (£450,000 in London). Take care if also contributing to a Cash ISA in the same tax year when providers have varying restrictions.  It will take just over four and a half years to reach the maximum £3,000 bonus if saving £200 per month (after making the maximum initial deposit).

However, as the Help to Buy ISA is only available to open until 30 November 2019, time is running out to benefit from this scheme.

If you open a Help to Buy ISA and do not use it to buy your first home (or to buy one costing more than the qualifying amount) you don’t lose the money. You can take cash out of a Help to Buy ISA whenever you need, you then do not qualify for the bonus. It will still be tax-free and you will still receive any interest accrued.

Hope you all have a great weekend from myself and my colleagues at Three Counties!

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