Help to Buy ISA guide

margaretx9

MDMD said:

masonic said:

margaretx9 said:

Amongst split isa providers Nationwide allow transfers in - but I think their HTB isa rate is being cut to 1% from 1 May so not the best rate.

Are you sure - that Nationwide will allow people to open a new HTB ISA for transfers, and that their rate is being cut?

I was under the impression Nationwide was no longer accepting applications to its HTB ISA even for transfers. As a current HTB ISA holder I've not been informed of any upcoming rate change and can find no information about it on the website.

HTB rate is being cut along with every account they have 

https://www.nationwide.co.uk/-/media/MainSite/documents/products/savings/support/SMD008-terms-and-conditions-1-may-2020.pdf

Useful list - perhaps Nationwide need to rationalise their list of old accounts - just far far too many that requires a 35 table document to list them all?!
Perhaps they could then spend their money on paying better rates than administering multiple account types!
From next month for example you will earn a grand total of £1 a year in interest for every £10,000 invested in their (once market leading) flexclusive ISA for their current account holders!  Worth it though for the 40p tax saving for higher rate taxpayers I am sure!!
Why bovver?

masonic

margaretx9 said:

So does that mean Newcastle BS is the only split isa provider which permits you to open a help to buy isa and transfer into it as per the OP's question? Aldermore seems to adopt Nationwide's approach - not sure about RBS/Natwest. The other split isa providers like Paragon and Ford Money didn't offer the product anyway - although Paragon has a lifetime isa (paying 1.15%).

Natwest's information sheet makes it clear it is not available to new customers, so it seems to have taken the same approach. So yes, Newcastle BS would seem the only option, with the currently undesirable requirement to visit a branch to open. I'm not sure this would meet the requirements for breaking the Government's staying at home guidance.

masonic

MDMD said:

masonic said:

MDMD said:

masonic said:

margaretx9 said:

Amongst split isa providers Nationwide allow transfers in - but I think their HTB isa rate is being cut to 1% from 1 May so not the best rate.

Are you sure - that Nationwide will allow people to open a new HTB ISA for transfers, and that their rate is being cut?

I was under the impression Nationwide was no longer accepting applications to its HTB ISA even for transfers. As a current HTB ISA holder I've not been informed of any upcoming rate change and can find no information about it on the website.

HTB rate is being cut along with every account they have 

https://www.nationwide.co.uk/-/media/MainSite/documents/products/savings/support/SMD008-terms-and-conditions-1-may-2020.pdf

Thanks, according to that there is no change on 1st May, but they are reducing as of 15th May. I suppose I can expect to be notified shortly.

As to the other point, although not so relevant in light of the rate cut, it doesn't look like Nationwide's HTB ISA is open to new applicants at all. https://www.nationwide.co.uk/support/support-articles/faqs/help-to-buy-isa-faqs

"We’re no longer offering Help to Buy: ISAs to new applicants. If you already have a Help to Buy: ISA with us, here are some frequently asked questions about managing it."

That is my understanding too. I will probably move mine to Halifax in May at 1.85% but stop paying in as I’ve been utilising the Nationwide flexibility to pay into the HTB without using any allowance (withdraw from another NW ISA and pay back into the HTB. I’m at £12k anyway.

That's a good option. I actually started off with the Halifax HTB ISA, but decided to start again somewhere else after making the one-time transfer to a LISA. But then again, I can still get 1.75% on a relatively short-term (non-ISA) fix, so transferring to my S&S ISA and keeping life simple is tempting... decisions, decisions.

Alexland

masonic said:
I actually started off with the Halifax HTB ISA, but decided to start again somewhere else after making the one-time transfer to a LISA.

Sneaky so you managed to get a bigger bonus on your LISA and can still rebuild the HTB ISA to £12k. Do you intend to claim the HTB ISA bonus or are you just using it as a high interest account?

masonic

Alexland said:

masonic said:
I actually started off with the Halifax HTB ISA, but decided to start again somewhere else after making the one-time transfer to a LISA.

Sneaky so you managed to get a bigger bonus on your LISA and can still rebuild the HTB ISA to £12k. Do you intend to claim the HTB ISA bonus or are you just using it as a high interest account?

I'm just using the HTB ISA for the interest rate, although it's good to keep options open and in the right circumstances it might fit the bill better than my LISA. Which is the only thing making me hesitate to transfer to my S&S ISA.

Alexland

masonic said:

I'm just using the HTB ISA for the interest rate, although it's good to keep options open and in the right circumstances it might fit the bill better than my LISA. Which is the only thing making me hesitate to transfer to my S&S ISA.

Around here there would need to be a collapse in the housing market for anyone to be able to use a HTB ISA even on a starter home. So are you intending to buy anytime soon and if so would you use some of your S&S LISA?

masonic

Alexland said:

masonic said:

I'm just using the HTB ISA for the interest rate, although it's good to keep options open and in the right circumstances it might fit the bill better than my LISA. Which is the only thing making me hesitate to transfer to my S&S ISA.

Around here there would need to be a collapse in the housing market for anyone to be able to use a HTB ISA even on a starter home. So are you intending to buy anytime soon and if so would you use some of your S&S LISA?

No, I've no intention to buy in the short term, barring a stellar opportunity coming along. I don't really want to buy where I'm currently working and there's a definite local shortage of the type of property I'd want. One option would be to buy the house I'm currently renting, but for that I probably wouldn't need a mortgage (very cheap area), so potentially not much advantage in taking one out just to benefit from a £1-2k bonus on my HTB ISA. As my LISA penalty free access date draws closer it becomes more useful to be used in retirement. My landlord is not interested in selling at the moment, and with my housing costs being about 15% of my net income, I'm not particularly motivated make any compromises for the sake of ownership.

Middle_Sister

Alexland said:

You are fine if the HTB ISA goes over £12k but the bonus is limited to £3k however it doesn't sound like you will get a bonus as the property will be above the price limit. As such it's just a good interest savings account.

If you want to get a 25% bonus on a property costing £400k outside London you would need to use a Lifetime ISA which goes up to £450k. You can add or transfer up to £4k per tax year into a LISA starting on 6th April each year. The LISA would need to be open 12 months before being used to support the purchase. However beware if the property is above £450k then you cannot withdraw without penalty before age 60.

If a LISA meets your needs and you act very quickly you might still be able to deposit the first £4k into a LISA this week to count against this tax year.

I thought I could transfer the whole £15,000 into a LISA but from what I read I can only put in £4,000 each tax year. Is that right? 
So I transfer only £4,000 this tax year then £4k each year therefore it would be at least 3 years before I could benefit from the Govt bonus?

Alexland

Middle_Sister said:

I thought I could transfer the whole £15,000 into a LISA but from what I read I can only put in £4,000 each tax year. Is that right? 

You might be remembering a special transition arrangement from when LISAs first launched 3 years ago when transferring a whole HTB ISA was possible. Now you can only add or transfer £4k for a £1k bonus each tax year.

Middle_Sister said:
So I transfer only £4,000 this tax year then £4k each year therefore it would be at least 3 years before I could benefit from the Govt bonus?

The 25% government bonus is added into the LISA account a month or two after each contribution. The account needs to be open with an initial contribution at least 12 months before your solicitor can withdraw without penalty for a qualifying property purchase. There is no overall £3k bonus limit on the LISA.

stehouk

Santander are reducing the htb isa (issue 1) rate down from 4% to 2.75% effective from 22nd may 2020..... gutted as mine was 4.25%.