HTB ISA Bonus Clarification - Moving Goalposts!

TJParsons

Hello,

We have just received our mortgage offer from Halifax, and have at this point been through several iterations of financial schedules, due to the mixed messages we have been receiving re: the Help To Buy ISA bonus. Like many, we were concerned to learn that the bonus could not actually be used for the exchange deposit, but managed to re-vamped our schedule and cashflow accordingly to make it work.

During a previous conversation I had with the mortgage adviser of my local Halifax branch, I was told that the bonus would be paid for completion, and that the best route would be to borrow the bonus amount from a family member until it came through, allowing us to pay the full deposit on exchange. Luckily my partners parents agreed to this, on the basis that we'd pay them straight back once the bonus came through, and that this would not compromise the process in any way.

Today I received an email from my conveyancing solicitor (I'm one of those who likes to double and triple check everything to avoid nasty surprises, and so brought up the bonus once again) and this time was told that the bonus would be used for 'legal fees', which goes against what I have read elsewhere online about how the bonus can be used. I have asked for clarification over whether 'legal fees' includes the stamp duty, as that is included in our completion statement from them, but it is yet another case of moving goalposts when I'm trying hard to ensure that I have everything covered and planned out.

At completion, we will owe the solicitors just over £600, plus £1,600 stamp duty and the deposit. Our mortgage comes with £1,000 cashback (which was intended to go towards stamp duty), so there will be a surplus of £300 if we use the bonus and cashback for these things. That works fine for me, as long as we can definitely borrow the money from my partners parents to cover the bonus amount for the exchange deposit, and then pay them back at completion with the £300 surplus plus the balance from that months pay (which I had originally earmarked for the stamp duty, thinking that there was 30 days to pay it and that it could be put on a CC, something that my solicitor has since stated is not the case). Can someone clarify whether I have this all right?

Apologies, that turned into a bit of an essay, but thank you in advance for your help.

kingstreet

Your solicitor gets the bonus.

They have that plus the other money you hand over ahead of completion.

They pay out for stamp duty, any balance due on the property, their own fees etc.

CML requirement if you have a mortgage, stamp duty must be in solicitor hands ahead of completion, so no 30 days. Can't normally pay by CC. Solicitor won't pay merchant fee to give you this option.

wjr4

Also, a quick note re cashback - this will usually be within a month of completion - not before completion?

TJParsons

Thanks a lot for that Kingstreet. To clarify, will borrowing the money from my Partners parents to pay the exchange deposit bonus amount cause any issues?

kingstreet

rjw4 wrote: »

Also, a quick note re cashback - this will usually be within a month of completion - not before completion?

Depends on lender.

Some send it with the mortgage funds for completion. Others send it afterwards.

I agree it can't be relied on for completion funding requirements.

kingstreet

TJParsons wrote: »

Thanks a lot for that Kingstreet. To clarify, will borrowing the money from my Partners parents to pay the exchange deposit bonus amount cause any issues?

None that I can imagine.

TJParsons

The language in the mortgage offer states:

"Provided you take out the mortgage, we will pay you £1,000 as a cashback. We will send your conveyancer this amount shortly before the date when you are due to take out your mortgage. You can use this money for any purpose you want."

kingstreet

TJParsons wrote: »

The language in the mortgage offer states:

"Provided you take out the mortgage, we will pay you £1,000 as a cashback. We will send your conveyancer this amount shortly before the date when you are due to take out your mortgage. You can use this money for any purpose you want."

Halifax or Virgin Money?

kingstreet

If Halifax, they had systems problems paying stamp duty incentives last year in time for completion. Some borrowers had t find the stamp duty from elsewhere so they could complete because Halifax didn't release the cashback to the solicitor with the mortgage funds.

Hopefully, that's now resolved.

TJParsons

It is indeed Halifax, thanks for the heads up! Nothing about this process is easy. I'll manage the parents expectations that we we may need to borrow a maximum of the bonus and stamp duty so it isn't a big drama if we need it.