Help to Buy ISA guide

verycleverusername

Hi, can anyone help. I have £11,000 in a Help to Buy ISA, which will get me a £2750 bonus. When submitting a mortgage application, will the lender take it into account when totting up the downpayment and, therefore, the monthly repayments?

eskbanker

verycleverusername said:

Hi, can anyone help. I have £11,000 in a Help to Buy ISA, which will get me a £2750 bonus. When submitting a mortgage application, will the lender take it into account when totting up the downpayment and, therefore, the monthly repayments?

They certainly should - provided the purchase complies with the rules of the scheme, the money is available for use towards the price of the property, thereby reducing the value of the mortgage you need.

firsttimebuyer1995

Hello all!
Quick question.
We currently live in private rented property. We're in the process of buying our first home. Mortgage offer, money, all in place. Sellers are ready, we're ready. It's literally just our solicitors that have been terrible with dragging their feet.
Our private lease is over as of June 1st, we'll technically be homeless. The solicitors have known this for a long time and still have taken ridiculous amounts of time to do things.
The plan is a completion date of the 28th of May. The seller's solicitors want this, we want this and our solicitors have said this should be no problem but we're yet to have it in writing.

We have a Help To Buy ISA with approximately £3000 in it. We've badgered the solicitors for weeks now, really highlighting the ISA (incase it adds time to proceedings). As of about an hour ago, I've now received a form via email, requesting that I close the ISA and provide the solicitors with the closure statement. It then goes on to say that drawing down on the ISA can take "up to 12 working days" and potentially "an additional five days". There are exactly 12 working days left until we're technically homeless.

My question is, does providing the closure statement get the ball rolling, and is that enough progress? Can we complete while the process of "drawing down" takes place in the background or do we have to wait for the funds to have been released before we can complete? The bonus is not factored into our deposit or anything, we can cover the costs of the bonus if it came after completion.

If we need the process to complete before we can complete on the property, then we're likely going to have to pass up on using the ISA all together.

masonic

firsttimebuyer1995 said:

My question is, does providing the closure statement get the ball rolling, and is that enough progress? Can we complete while the process of "drawing down" takes place in the background or do we have to wait for the funds to have been released before we can complete? The bonus is not factored into our deposit or anything, we can cover the costs of the bonus if it came after completion.

The bonus money must be received prior to completion and included in the consolidated funds sent to the seller's solicitors.

You should have been advised to close the HTB ISA as soon as you were confident you would complete on a purchase (you have up to a year to do so). There seems no good reason for delaying. There is an emergency bonus claim process that can be used if needed, but this seems like a case of the solicitor running down the clock for whatever reason. If you move swiftly now, it's possible the bonus money will be claimed with time to spare.

Suggest you complain and try to recover your losses from your solicitors if they cannot complete the bonus claim in time.

grumiofoundation

firsttimebuyer1995 said:

Hello all!
Quick question.
We currently live in private rented property. We're in the process of buying our first home. Mortgage offer, money, all in place. Sellers are ready, we're ready. It's literally just our solicitors that have been terrible with dragging their feet.
Our private lease is over as of June 1st, we'll technically be homeless. 

Have you exchanged?

When you say your lease is over do you mean your fixed term tenancy expires?
Or do you mean you have given notice to leave?

If the former you will not be 'homeless' - you can just stay in the property and a periodic tenancy will be created (Letting agent/landlord cannot stop this - whatever they told you). If the latter then sadly that was the risk you took giving notice before exchange. 

Very helpful guide on the Housing board (see link).
https://forums.moneysavingexpert.com/discussion/5180214/tenancies-in-eng-wales-guides-for-landlords-and-tenants/p1

Agree with above would get on with closure and claiming HTB ISA bonus ASAP. 

firsttimebuyer1995

We had all of our searches back at the start of April. House was ready. Money ready. Just waiting on exchange of contracts and a completion date. You're right, we know it's our fault for giving notice as May being our last month, but we assumed that 7 weeks would be ample time to exchange contracts when there was nothing else to do other than claim the ISA bonus and exchange contracts. Solicitors were made aware of our living situation last month, several times, and the need to complete before the end of May. Just don't know why they've dragged their feet this long.

firsttimebuyer1995

Regardless. Went on my lunch and got closure statement, only took a few minutes in branch. Hopefully there's still time. Thanks for the replies.

masonic

firsttimebuyer1995 said:

Regardless. Went on my lunch and got closure statement, only took a few minutes in branch. Hopefully there's still time. Thanks for the replies.

There should still be time, according to the Conveyancer Guidelines, for a normal claim, "A Bonus Request must therefore be made at least 5 Business Days before completion of a property purchase"... and "The Eligible Conveyancer can, by exception, make an urgent Bonus Request via the online portal stipulating a payment date of no less than 24 hours".

iMarkeh

I am on Universal Credit and have a Help to buy Isa. Does this specific isa count towards my Universal Credit savings thing and do I have to declare to them that I have the ISA?

grumiofoundation

iMarkeh said:

I am on Universal Credit and have a Help to buy Isa. Does this specific isa count towards my Universal Credit savings thing and do I have to declare to them that I have the ISA?

Savings in a help to buy ISA would be counted towards the savings limit for universal credit.
I don't know the practical details of what you have to declare but I assume it would be the same as you do for other accounts.

For more specific, practical queries you may be better posting on the benefits board
https://forums.moneysavingexpert.com/categories/benefits-tax-credits