Help to buy ISA

ashe

Hi there,

Looking for some clarity on H2B isa. We are selling the home that I own and buying another property - our finances break down as follows:

Help to buy isa balance £6,600
Help to buy bonus £1,650
Difference between sale price of my property and mortgage balance : £11,200
Mortgage cashback £500

Total £19,950

Ive budgeted that we need:

5% deposit £11,500
Legal fees for the sale £500 (£50 deposit paid)
Legal fees for the purchase £1000 (£250 deposit paid)
Removal services £500ish
Stamp duty £1960
EA fees £1140
Survey £395 (paid)
ERC in current mortgage £60

Total £17,005

This should leave us with about £3000 left over, on top of other money we already have, however have been reading that htb bonus cant be used for exchange deposit - is this often a problem?

I assume solicitors will pay themselves and EA out of the money remaining at the end of the transactions - and that its often possible to negotiate a 5% exchange deposit which makes sense as our mortgage is only 5% deposit. Our deposit is basically the £6600 in the ISA and the money from the sale of the house, with the bonus paying the stamp duty partially. Is there likely to be any problems? Same solicitor form is dealing with my sale and purchase

Rich2808

Firstly I assume the person you are buying with is a first time buyer - as you of course already own a property so are ineligible to hold an HTB isa or get a bonus.

https://www.moneysavingexpert.com/savings/help-to-buy-ISA

The help to buy isa bonus is only paid by the Government to your solicitor post completion. So it can be use for the mortgage deposit but not the deposit at exchange of contracts (see section 9 and 10 at this link). And make sure your solicitor is registered to claim the bonus before engaging them - not all are and you don't want to find out too late and see your partner lose any bonus,

https://www.moneysavingexpert.com/savings/help-to-buy-ISA

Thrugelmir

ashe wrote: »

that its often possible to negotiate a 5% exchange deposit which makes sense as our mortgage is only 5% deposit.

Depends on what your vendor has to find as a deposit on their purchase. Standard exchange deposit is 10%.

ashe

Thrugelmir wrote: »

Depends on what your vendor has to find as a deposit on their purchase. Standard exchange deposit is 10%.

He is not in a chain and is moving in with his brother.