HTB and Cash ISA possible!?

PawelK

Hi.

Since new htb launch I cant help feeling that I am penalised for saving already (e.g. Contributing each month to my old cash isa) as this would disqualify me from opening htb this month and wait until April 2016 causing me four months delay with saving for the ftb bonus.

But saying that, I went to few banks at lunch time today and found out interesting things. While my ISA provider Santander said that because I already contributed this tax year more than £1200, I have to wait until April to open a htb isa. I then went to hsbc to ask the same and the lady (seeming more knowledgeable than the lady in santander) confirmed I have to wait until April.

Then I gave the last one shot (after recent news from Martin) and went to Nationwide to see if the fact they can do the isa split will make me eligible or not. The lady there spent some time looking and reading after which she phoned her colleage who I assume was more senior than her. After the call she confirmed that if I was to transfer the whole cash isa to them, they will be able to open htb and transfer initial £1200 while the remaining balance would be still in the cash isa I would transfer my existing one into.

So, it looks like after all it may be possible to open htb while having cash isa from previous years and making contributions this tax year. It would be great if anyone can confirm this and also advise on what would happen if, say, Nationwide opens that for me and then finds out that I was actually illegible? Would they just close the htb and transfer the money back to my cash isa? Or would they not be physically able to open htb without 100% sure it is compliant etc.? Would I potentially suffer any fines if I was misinformed by the bank?
She gave me the transfer in form so I could fill it in even this evening and go to the bank tomorrow to start transfer process.

Thanks for reading.

Pawel

MARTYM8`

Don’t forget there are current accounts and regular savers which may offer better interest than a cash isa.

This includes the Nationwide flex direct account and new regular saver which both pay 5% each (5% on £2,500 and 5% on £500 invested per month for 12 months).

If you use Nationwide refer a friend and do a switch (can be a dummy account not you main one) and once referred THEN apply to open it via quidco/topcashback you could get £176 cashback plus whoever refers you gets £100 as well. Plenty of Nationwide customers on here – although you probably have a family member/friend who already has a Nationwide current account. This gives you access to the 1.6% flexexclusive ISAs – one of the highest paying instant access isas around – which is better than their standard isa which pays only 1.4%

http://www.nationwide.co.uk/products/current-accounts/landing-page/recommend-a-friend

http://www.topcashback.co.uk/nationwide-flex-direct/

PawelK

Are you an employee of Nationwide?
The main point of my post, however, was not about maximising my savings returns but whether I can actually have an htb this month rather than waiting until April. It seems that banks staff is quite confused themselves, giving different opinions per bank.

MARTYM8`

PawelK wrote: »

Are you an employee of Nationwide?
The main point of my post, however, was not about maximising my savings returns but whether I can actually have an htb this month rather than waiting until April. It seems that banks staff is quite confused themselves, giving different opinions per bank.

No just highlighting options!!

TSB, Bank of Scotland, Tesco, Lloyds and more do high interest paying current accounts and TSB/Lloyds have good regular savers too. Tesco however doesn’t require you to pay a minimum sum each month – the others range from £500 for TSB to £1500 with Lloyds.

jimjames

PawelK wrote: »

Are you an employee of Nationwide?
The main point of my post, however, was not about maximising my savings returns but whether I can actually have an htb this month rather than waiting until April. It seems that banks staff is quite confused themselves, giving different opinions per bank.

On this the staff are not confused as it depends on the bank. Some allow the facility of multiple ISA types within the same year, some don't. So all the advice you got from different banks is correct. Nationwide is one that does allow it to be split.

Whether a cash ISA is a good idea is another matter, I can't see why anyone saving for a house deposit would bother with a cash ISA other than HTB ISA.

Eco_Miser

Assuming you meet the other conditions for HTB ISA, then the three people you spoke to are (probably) all correct in that you cannot open a Santander or HSBC HTB ISA and keep your current ISA, but, because of the different way Nationwide handle ISAs, you can transfer it all to them, then open the HTB. I don't know what would happen if you prove to be ineligible.

However, it's possible to get 4% in a Halifax HTB ISA, and 3%-6% over a range of current and regular saver accounts on over £50,000 as Martym8 has mentioned. This would give you a bigger income, especially considering the £1000 tax free interest allowance due to start in April.

darkidoe

Yes you can! Nationwide allows you to split the Cash ISA allowance with the HTB ISA. It's still very new though, but in theory there doesn't sounds to be any problems.

http://www.moneysavingexpert.com/savings/help-to-buy-ISA#nationwide

eskbanker

darkidoe wrote: »

Yes you can! Nationwide allows you to split the Cash ISA allowance with the HTB ISA. It's still very new though, but in theory there doesn't sounds to be any problems.

Just to clarify, the HTB ISA itself is obviously new but Nationwide's policy of allowing multiple current-year cash ISAs has been around for quite a long time so their implementation of HTB just fits within their existing well-established model.

PawelK

jimjames wrote: »

On this the staff are not confused as it depends on the bank. Some allow the facility of multiple ISA types within the same year, some don't. So all the advice you got from different banks is correct. Nationwide is one that does allow it to be split.

Whether a cash ISA is a good idea is another matter, I can't see why anyone saving for a house deposit would bother with a cash ISA other than HTB ISA.

A lady in santander was reading t&cs on her screen for about ten minutes and after every sentence she tried to understand what it exactly meant applying to my situation hence it seemed to me she was not very confident (but I dont blame her as htb is new to everyone).
With regards to saving please advise any better option without too much hassle running between the banks and opening four or five savings accounts with capped amounts etc.
I currently use my total limit of 20k on 123 current account and have 30k in the cash isa, paying around 1.4% I think. If I was to transfer £1200 to htb, where would be to invest the remaining £28800 with instant access as I am already looking on the property market and although it doesnt seem like soon, I might find something early 2016 so would need the funds.

PawelK

Eco_Miser wrote: »

Assuming you meet the other conditions for HTB ISA, then the three people you spoke to are (probably) all correct in that you cannot open a Santander or HSBC HTB ISA and keep your current ISA, but, because of the different way Nationwide handle ISAs, you can transfer it all to them, then open the HTB. I don't know what would happen if you prove to be ineligible.

However, it's possible to get 4% in a Halifax HTB ISA, and 3%-6% over a range of current and regular saver accounts on over £50,000 as Martym8 has mentioned. This would give you a bigger income, especially considering the £1000 tax free interest allowance due to start in April.

I was thnking about halifax and then close my cash isa and transfer the remaining balance to some savings account. However, I understood that since Halifax des nit offer the split I cant open htb with them this tax year and have to wait until April next year. I havent spoken to them directly about this but santander and hsbc proved to be the case. I already save into a regular saver in hsbc which gives me 6% but the monthly contribution is capped at £200. Also, I do not want to lock too mych of my savings in another regular as I prefer instant access because I am already looking for a flat.

PawelK

darkidoe wrote: »

Yes you can! Nationwide allows you to split the Cash ISA allowance with the HTB ISA. It's still very new though, but in theory there doesn't sounds to be any problems.

http://www.moneysavingexpert.com/savings/help-to-buy-ISA#nationwide

Thanks for confirming this. I have read the link above but extra reassurance is appreciated. It looks like I will go ahead with the application and transfer my whole cash isa into nationwide this week.