Help to Buy ISA guide

Marigold123

Does anyone have any up-to-date rates for transferring-in Help to Buy ISAs? My son's account with Nationwide just announced a rate drop from 2.5% to 1%, which is a total bummer, if not entirely unexpected.

The main article here currently only mentions Halifax and the two local providers, but I've found at least one other bank which beats the Halifax rate, (Barclays are offering 2.05% AFTER the base-rate drop), and am trying to find others. I'm finding it impossible to do any comparisons as the product is no longer available to new customers, and there's no profit for third-party sites in offering info on it!

If anyone knows of any up to date resources, (or individual rates), so I don't have to go to the website of every bank in the country, I'd be hugely grateful.

eskbanker

Marigold123 said:

Does anyone have any up-to-date rates for transferring-in Help to Buy ISAs? My son's account with Nationwide just announced a rate drop from 2.5% to 1%, which is a total bummer, if not entirely unexpected.

The main article here currently only mentions Halifax and the two local providers, but I've found at least one other bank which beats the Halifax rate, (Barclays are offering 2.05% AFTER the base-rate drop)

I don't believe Barclays is an option for new applicants/switchers, as explained at https://www.barclays.co.uk/savings/isas/help-to-buy-isa/

Can I transfer-in from another ISA?

Yes, you can transfer-in using Online Banking, Telephone Banking (0345 744 5445 1) if you’ve registered for these services, or by visiting a branch. You’ll need to have opened a Help to Buy: ISA with us by the deadline of 30 November 2019.

The MSE article does continue to be updated and had HSBC instead of Halifax until very recently.

hgt

I've been looking to transfer my HTB ISA out of Nationwide also, as far as I've been able to tell, the only providers allowing a transfer in of a HTB ISA are limited to.....

Newcastle BS - 2.3% (Branch based)
HSBC - 1.75%
Buckinghamshire BS - 1.75% (Branch based)
Halifax - 1.7%
Yorkshire BS - 1.0% (No better than Nationwide)

margaretx9

hgt said:

I've been looking to transfer my HTB ISA out of Nationwide also, as far as I've been able to tell, the only providers allowing a transfer in of a HTB ISA are limited to.....

Newcastle BS - 2.3% (Branch based)
HSBC - 1.75%
Buckinghamshire BS - 1.75% (Branch based)
Halifax - 1.7%
Yorkshire BS - 1.0% (No better than Nationwide)

HSBC only pays 1.75% on the first £12,000 - its basically zero interest (0.01%) on the excess.
Halifax pays 1,7% on the whole balance.
Personally - especially if you are planning to pay in long term - the Halifax is the better option.
Surprising more providers don't offer it - as surely its a good way to attract FTB mortgage business so a loss leader

jasonafc

Like most of you, I will be jumping ship from Nationwide to Halifax.
However, I am wondering what happens to the 2.5% rate if you transfer out before the account matures? I've only had the account 8 months, will I still get 8 months worth of interest? 

eskbanker

jasonafc said:

Like most of you, I will be jumping ship from Nationwide to Halifax.
However, I am wondering what happens to the 2.5% rate if you transfer out before the account matures? I've only had the account 8 months, will I still get 8 months worth of interest? 

It doesn't mature as such, but, as with pretty much any savings account, closure ahead of scheduled interest payment will result in interest being paid pro rata.

ivrimon

margaretx9 said:

HSBC only pays 1.75% on the first £12,000 - its basically zero interest (0.01%) on the excess.
Halifax pays 1,7% on the whole balance.
Personally - especially if you are planning to pay in long term - the Halifax is the better option.
Surprising more providers don't offer it - as surely its a good way to attract FTB mortgage business so a loss leader

Personally, I am thinking of switching to HSBC. It would take me another 4ish years to reach £12,000, and there is no government bonus above that amount anyway, and I assume I could always transfer to another provider in a couple of years anyway?

masonic

ivrimon said:

I assume I could always transfer to another provider in a couple of years anyway?

You could if there were any providers remaining that allowed you to open a new account for the transfer. That is in no way guaranteed.

Middle_Sister

eskbanker said:

Middle_Sister said:

eskbanker said:

Middle_Sister said:

Okay. This is what I am thinking of doing. Can you please advise me if its right.
I plan to transfer £4k from my £12k HTB ISA either into a S&S LISA or a cash LISA. I'll keep adding £200 into my HTB ISA and just use it as a saving vehicle as the rate is pretty good then next tax year transfer another £4k across into my LISA and the same the following year.  Then I plan to put £20k into a S&S ISA each tax year starting now.

Nobody can say if it's 'right' but it's certainly possible and legitimate.  What are you hoping to achieve, in terms of if/when you'll be looking to get onto the property ladder and when you're likely to need each of your pots of money?  In general, stick to cash-based products for anything needed within the next five years....

Thanks for that.  I was a bit worried about whether I'd be allowed to contribute to the 3 accounts at the same time.

You wouldn't be contributing as such to three accounts at the same time though, you'd only be paying new money into the S&S ISA and the HTB ISA, while transferring old money into the LISA?  I hadn't spotted that the amounts don't work - if you're paying £2,400 into the HTB then that only leaves £17,600 of your allowance to put into the S&S ISA....

I think I'm up the creek without a paddle here.  I've continued paying into my HTB ISA this April but now I believe I can't contribute to a cash HTB ISA and a cash LISA in the one tax year. Is that correct?  If so, I'll cancel the £200 payment into my HTB ISA and transfer £4k into a new cash LISA for this tax year. I believe then I can still contribute the remaining £16k into a S&S ISA for this tax year.  How does that sound? 

eskbanker

Middle_Sister said:
I've continued paying into my HTB ISA this April but now I believe I can't contribute to a cash HTB ISA and a cash LISA in the one tax year. Is that correct?

No, you are allowed to pay into both a HTB ISA and a LISA (cash or S&S).

Middle_Sister said:
If so, I'll cancel the £200 payment into my HTB ISA and transfer £4k into a new cash LISA for this tax year. I believe then I can still contribute the remaining £16k into a S&S ISA for this tax year.  How does that sound? 

As above, you can pay into HTB and LISA so perhaps this doesn't apply, but if you transfer £4K from HTB to LISA then this wouldn't be deducted from your overall ISA annual allowance so you'd still have £19,800 left if you've paid £200 into HTB, or £17,600 if you continue to do so every month.