Help To Buy ISA - Cash Buyer

_CC_

Official MSE Insert:

You may also find our fully researched Help to Buy ISA guide helpful.

Back to the original post...

Apologies if this has been covered elsewhere.

Can the Help To Buy ISA be used by someone (FTB) purchasing a property with cash, or is it only possible with a mortgage?

Thanks

WannaBLoaded

you don't need help to buy if you are a cash buyer.

_CC_

WannaBLoaded wrote: »

you don't need help to buy if you are a cash buyer.

I agree, but I'm asking if the "Help-To-Buy ISA" policy is specifically limited to those taking out mortgages or if it's possible with a cash purchase.

eskbanker

There doesn't seem to have been a huge amount of definitive documentation published since the government paper announcing the scheme, but in that document it's stated that the HTB ISA is to be used towards a deposit, without any dependencies on how the rest is funded. The MSE piece refers to mortgages but only in the context of clarifying that it doesn't need to be an HTB mortgage.

masonic

_CC_ wrote: »

I agree, but I'm asking if the "Help-To-Buy ISA" policy is specifically limited to those taking out mortgages or if it's possible with a cash purchase.

My understanding is that the mechanism for receiving the top up is to have it added during a mortgage application. It doesn't get added to the ISA.

_CC_

masonic wrote: »

My understanding is that the mechanism for receiving the top up is to have it added during a mortgage application. It doesn't get added to the ISA.

This was my initial assumption, but the MSE article says the money is retrieved by the solicitor not the mortgage provider.

_CC_

eskbanker wrote: »

There doesn't seem to have been a huge amount of definitive documentation published since the government paper announcing the scheme, but in that document it's stated that the HTB ISA is to be used towards a deposit, without any dependencies on how the rest is funded. The MSE piece refers to mortgages but only in the context of clarifying that it doesn't need to be an HTB mortgage.

Thanks

I assumed the funds were given to the mortgage provider, but the article you link to says it's given to the solicitor and the Government paper has no mention of mortgages. As you say, the MSE article just refers to mortgages in the context that you can use the ISA with or without the other HTB schemes

WannaBLoaded

Another way i would look at it, as a cash buyer. You are in a position to buy now, house prices seem to be steadily going up, which means any government contribution is really just a way of limiting the decay on peoples buying funds.

I will be opening one in december, putting in the grand, which gets £250? then paying into it until april or may which will get me eligible for £400 - £500 but house prices would have risen by that much anyway. Although i will be buying a run down house that could be difficult to sell so i may still benefit.

To get the full allowance the time paying in is years.

One thing i would like to know myself, if you already have an isa with a bank do you have to close it to open the htb one?

masonic

_CC_ wrote: »

This was my initial assumption, but the MSE article says the money is retrieved by the solicitor not the mortgage provider.

Well it would make sense that the solicitor would receive it as it is supposed to be combined with (and form part of) the deposit.

eskbanker

WannaBLoaded wrote: »

One thing i would like to know myself, if you already have an isa with a bank do you have to close it to open the htb one?

Only if you want to pay new money into both in the same tax year.