Closing ISA Accounts.

connors07

Hi guys,

I am new to understanding the rules and regulations with regards to closing my ISA accounts. Firstly, I am in the process of getting together all my obtainable funds to get a mortgage and I have two ISAs - one expires next year and another in 2016 but I will need access to the funds.

I sent a message online to my bank saying that I would need to close the accounts and what the process is to do so. My bank replied with the following:

I can confirm that partial withdrawals are not allowed on a Fixed Rate ISA. Access to the whole balance is allowed by closing the account or by transferring the cash ISA in full to another ISA. On early closure, a charge equivalent to 120 days interest will be applied to the account.

I'll be very honest I don't actually understand what kind of charge I'll be expecting, any advice would be much appreciated. Sorry for being such a newb and probably asking something painfully simple!

veryintrigued

connors07 wrote: »

Hi guys,

I am new to understanding the rules and regulations with regards to closing my ISA accounts. Firstly, I am in the process of getting together all my obtainable funds to get a mortgage and I have two ISAs - one expires next year and another in 2016 but I will need access to the funds.

I sent a message online to my bank saying that I would need to close the accounts and what the process is to do so. My bank replied with the following:

I can confirm that partial withdrawals are not allowed on a Fixed Rate ISA. Access to the whole balance is allowed by closing the account or by transferring the cash ISA in full to another ISA. On early closure, a charge equivalent to 120 days interest will be applied to the account.

I'll be very honest I don't actually understand what kind of charge I'll be expecting, any advice would be much appreciated. Sorry for being such a newb and probably asking something painfully simple!

Charge is equiv to about a third of the interest you'd expect to receive a year.

Does this make it easier for you - i.e. are you able to calculate the interest you'd expect to receive in a year and then divide that by 3?

Hope this helps.

thenudeone

.. so if the interest rate was 3% (just for illustration), the penalty would be just over 1% of the account balance.