Help to Buy ISA guide

Rich2808

kirsty135c wrote: »

Hello,

A great article but I just want to double check something...

This year I opened a 'Cash ISA' and have £12, 000 saved in it. I want to open a 'Help to Buy ISA'. Can I open this second ISA this financial year or should I wait until April?

You talk about a split ISA, does this mean I can open both and put £3000 into a 'Help to Buy ISA' (the Halifax one sounds great) because I understand I have not reached my annual allowance yet?

Thank you very much!

You can have a help to buy isa and a cash isa if you invest with the Nationwide and three other providers - although only NW offers decent isa rates. You can of course transfer current year isa investments to these four and then open their HTB isa as well.

You won't be able to apply for the Halifax product though until April unless you withdraw that £12k. Sorry.

No idea why all providers don't offer the split option.

colsten

Rich2808 wrote: »

No idea why all providers don't offer the split option.

Because it costs them a lot of money to manage more than one ISA product as a single ISA. There has also historically been really not much of a requirement to do so.

Most people will be able to get better interest rates outside normal cash ISAs anyway.

yessuz

Hi Just have a question, as I struggle to understand this.

Let's say I have ~5k in other ISA. I open this HTB ISA. Should I transfer all my funds immediately, to be eligible for additional 25%, or should transfer just 1200 + 200£month?
or how it really works?

fuzzgun19

fuzzgun19 wrote: »

Just read this on the Halifax site.

• Your bonus is paid on purchase of a property up to the value of £250,000 outside London and £450,000 inside London

I thought you could just use this as a savings account and didn't have to buy a property?

jimjames wrote: »

Where does it say you have to buy a property?

As above.

Archi_Bald wrote: »

You will not get any bonus if you don't meet the bonus rules, which include the purchase price of your property, amongst others.

As I just posted, if you don't want to / cannot use the Help To Buy ISA for it's intended purpose, there are better accounts around to save money in.

So Martin was wrong? He said on TV you don't have to buy a property to get the bonus. That's what made me think it may be good for me.

Looks like this ISA is too complicated for me, I think I'll just go for the Flexclusive.

Strummer22

fuzzgun19 wrote: »

So Martin was wrong? He said on TV you don't have to buy a property to get the bonus. That's what made me think it may be good for me.
Looks like this ISA is too complicated for me, I think I'll just go for the Flexclusive.

Well what show was it, do you remember? I kinda doubt he'd have gotten that wrong, the T&Cs are extremely clear that the bonus is only paid when you close the account in order to buy a property. Even more to the point, the bonus will be paid directly to your solicitor, skipping out the buyer and all but eliminating the potential for fraud.

Martin would have said that you don't have to buy a property in order to get the interest. He may then have said that the bonus is paid on both the money you pay in and the interest earned.

You would be perfectly fine opening the account so long as you are eligible, and saving into it, and getting the interest. Whether in the end you use it to buy a property or not, what you've done is in no way contrary to the T&Cs. However, if you don't intend to buy a property you'll almost certainly save more money putting your lump sum into a high interest current account and drip feeding the maximum possible into one of the few 6% regular savers that are on the market.

Archi_Bald

fuzzgun19 wrote: »

As above.

it doesn't say anywhere that you must buy a property.

fuzzgun19 wrote: »

So Martin was wrong? He said on TV you don't have to buy a property to get the bonus.

I think you must have mis-heard what he said. You will not get the bonus unless you are a qualifying buyer of a qualifying property.

fuzzgun19 wrote: »

Looks like this ISA is too complicated for me, I think I'll just go for the Flexclusive.

I hope you mean the FlexClusive Regular Saver rather than the FlexClusive ISA.

Strummer22

Archi_Bald wrote: »

There is nothing I have seen in the Halifax HTB ISA T&Cs nor in the Scheme Rules published by the Treasury that says the HTB ISA must be closed when the ISA holder acquires a property. May be you could ask Halifax to show you the relevant clauses?

You must be eligible (i.e. be a first time buyer) when you open the ISA and when/if you apply for the bonus, but there is no obligation for ongoing eligibility. I also very much doubt anyone would do any ongoing eligibility check. HMRC, and/or their administrator UKAR, will not object to you holding an ISA as long as you don't exceed your allowance, and they will only check your eligibility when you claim the bonus.

Yep this is interesting. I wonder what the advice is if you buy your first home but it's above the limit for the bonus? This may well become more and more of an issue since the scheme says you have to buy by 2030, and who can say what will happen to house prices by then? Is it possible the government will raise the 250/450k limits in x number of years' time if prices have vastly increased (again!!)? Otherwise there may be many people who would be forced to buy a grotty hovel instead of their dream home as a FTB, if only for it to be cheap enough to qualify for the HTB bonus...

PS I understand if they have enough to buy their dream home the 3k (6k couple) bonus won't make or break it. But I know I'd be peeved if I was priced out of using my HTB bonus, if I'm looking to buy a house that's in the mid range of the FTB market.

bob_a_builder

re the limits
Thats what I was thinking too - the 250k limit seems a bit too low for some area of the south (berkshire specifcally )
1st son bought 1st house @ 250K 18 months ago
2nd son looking, now and its border line

Didn't the help to buy mortgage apply up to 600K purchase price ?

if so not so joined up thinking

fuzzgun19

Archi_Bald wrote: »

it doesn't say anywhere that you must buy a property.


I think you must have mis-heard what he said. You will not get the bonus unless you are a qualifying buyer of a qualifying property.


I hope you mean the FlexClusive Regular Saver rather than the FlexClusive ISA.

Maybe I mis-understood what he said. If you want to watch, he was on This Morning yesterday, here:

http://www.itv.com/hub/this-morning/1a1960a5192
About 42-43 mins in.

He says "If you don't use it for a house, it's still paying decent interest anyway", and "a lot of parents are doing it for 16yr olds."

And yes, I did mean the Flexclusive Reg saver.

AChernett

One son has just married and American girl and a Portuguese girl is planning to marry my other son. They have both been in England for ages and work here. Obviously my sons can open a House Buying ISA but can the girls do it too?