Help to Buy ISA guide

colsten

genbraine wrote: »

What is classed as the Outer London Boroughs?

See Schedule 9 of the Scheme Rules. Page right to the end of the document.

redux

Hi. I wonder if anyone can help with a question I'm struggling to answer myself by reading various versions of scheme rules and terms.

I don't foresee when I might buy my first property, but it may be worth starting an HTB ISA anyway with certain interest rates on offer.

If Halifax continue their 4% interest rate for some time, that's fairly attractive, but if they drop it in say 12 or 18 months time then maybe not so good if I still don't foresee a move for a few years.

Everything I read about closing the ISA then mentions getting the solicitor to apply for the bonus ...

But is it permissible to enter the HTB ISA scheme, then decide to exit and withdraw all money, then start again with a new account maybe 2 or 3 years later, or is there any restriction that you're only allowed one go at the scheme and tough luck if you don't use it?

Archi_Bald

redux wrote: »

But is it permissible to enter the HTB ISA scheme, then decide to exit and withdraw all money, then start again with a new account maybe 2 or 3 years later, or is there any restriction that you're only allowed one go at the scheme and tough luck if you don't use it?

Why would you want to do that? You'd lose all the months you already paid in. Each month = £50.

I doubt you would ever find any other account before 2030 (when the scheme ends) that pays you a 25% bonus. That's the real benefit of the HTB ISA. The interest rate is almost irrelevant (though clearly, I would opt for the highest, out of principle).

But if you are desperate, you can withdraw your cash (all bar £1), and just leave the ISA open. As and if you want to re-start it again, you can either do so at the same provider, or have it transferred to another provider. Note that you will be limited to £200 a month, there won't be another £1,000 lump sum opportunity.

redux

Archi_Bald wrote: »

Why would you want to do that? You'd lose all the months you already paid in. Each month = £50.

I doubt you would ever find any other account before 2030 (when the scheme ends) that pays you a 25% bonus. That's the real benefit of the HTB ISA. The interest rate is almost irrelevant (though clearly, I would opt for the highest, out of principle).

But if you are desperate, you can withdraw your cash (all bar £1), and just leave the ISA open. As and if you want to re-start it again, you can either do so at the same provider, or have it transferred to another provider. Note that you will be limited to £200 a month, there won't be another £1,000 lump sum opportunity.

Thanks. I don't anticipate being desperate for the cash.

Yes, the bonus is very good, and for someone paying in the maximum amount for the minimum time, the effect works out equivalent to over 8% per annum in a hypothetical parallel monthly savings account without bonus.

However if someone starts without an idea when they'll use it, and the account runs for 10 or 15 years, the effect of the bonus is spread over more years, and the equivalent interest rate could be about 3%, or even lower if a lot is put in early then just left.

So that's why I wonder if an account can be completely closed to exit the scheme, then start again from fresh a few years later.

So for instance, if Halifax drop their rate to say 1.5% by early or mid 2017, I might like to give up the HTB ISA at that point, then consider starting a new one which might run from 4 to 10 years from now.

eskbanker

redux wrote: »

So that's why I wonder if an account can be completely closed to exit the scheme, then start again from fresh a few years later.

So for instance, if Halifax drop their rate to say 1.5% by early or mid 2017, I might like to give up the HTB ISA at that point, then consider starting a new one which might run from 4 to 10 years from now.

Archi's suggestion still seems the most sensible option to me as it keeps your options open - if it looks like there's somewhere likely to generate better net interest in 2017 then move your ISA contents (except £1) elsewhere at that stage and restart the HTB ISA contributions again only if it makes sense to do so at a later date.

redux

eskbanker wrote: »

Archi's suggestion still seems the most sensible option to me as it keeps your options open - if it looks like there's somewhere likely to generate better net interest in 2017 then move your ISA contents (except £1) elsewhere at that stage and restart the HTB ISA contributions again only if it makes sense to do so at a later date.

Actually, on reflection, it's pretty much the same as what I was thinking about.

colsten

You don't have too many years to make up your mind whether you want an HTB ISA or not. One more reason for not wanting to close an HTB ISA you already have if your property purchase plans get delayed. Although 2020 is an election year, so lots might change then.

How long will Help to Buy: ISAs be available for?

You’ll be able to open a Help to Buy: ISA until 30 November 2019. After that date they won’t be available to new savers anymore – but if you opened your Help to Buy: ISA before then you can keep saving into your account.

You must claim your bonus by 1 December 2030.

- See more at: http://www.helptobuy.gov.uk/help-to-buy-isa/faq#sthash.xUapfj2D.dpuf

redux

colsten wrote: »

You don't have too many years to make up your mind whether you want an HTB ISA or not. One more reason for not wanting to close an HTB ISA you already have if your property purchase plans get delayed. Although 2020 is an election year, so lots might change then.

Yes, I'd spotted the 4 years limit to get started.

Halifax HTB ISA now opened. They wouldn't accept £1200 as a single transaction, but £1000 followed by £200 a few seconds later was fine.

J65ON

We have opened up help to buy ISAs in dec putting in the maximum amount, we will do the same on 1st Jan and 1st feb. this gets us to £1600 and qualifies us for the £400 bonus.
My question is how long after 1st feb could we exchange?

We are looking at a property at the moment and have convinced the developer to go beyond normal 28 day exchange so we can use the ISA, however I'm worried about how long the process of getting the money off the government is going to take

WLITC

Apoloigies if this is obvious or has been covered, but I am planning to open an HTB ISA and would like to save a futher £800 a month on top of the £200 max for the HTB ISA so I'm interested in these slip ISA's. I'm also planning on putting in the max £1200 to the HTB ISA in the first month.


If I go with the Halifax, how does the whole split ISA works? do I have to open them in a certain order, i.e a Cash ISA first and then the HTB? I'm keen to get the HTB ISA set up so I can get a payment in Dec but I don't want to rush into it and then not be able to get the split ISA.