Help to Buy ISA - Over Max Limit/Bonus from bank

SeaVixen

Hi all!
Hoping to buy a house shortly, and have been paying into a Help to Buy ISA since they started.
There is a slight chance that we will end up buying a house which is over the £250,000 limit to claim the government bonus.
We're prepared to factor the amount that we'll loose into our calculations of the price. Where we're looking the difference in what you get for 245 and 251 is pretty massive.

I really have two questions:

1. Is there a way we can get a seller the amount we want, without taking the house price over 250? Maybe offer to pay the estate agent fees for them?

2. I have found a building society which I can transfer my H2B ISA into, that offers a 10% bonus when you buy a house (of any value). The interest rate isn't as good as my current one, but I could transfer the ISA when we have an offer accepted and get the bonus. Has anyone seen any accounts with better bonuses or other benefits?

I have tried to look for this online, but putting "H2B" and "bonus" into Google obviously gives lots of results about the government bonus.

Many thanks in advance!

mije1983

SeaVixen wrote: »

Where we're looking the difference in what you get for 245 and 251 is pretty massive.

If something is listed at £251k, then chances are you can get it for under the £250k cap.

SeaVixen wrote: »

1. Is there a way we can get a seller the amount we want, without taking the house price over 250? Maybe offer to pay the estate agent fees for them?

If I was the seller I wouldn't entertain this. To make sure you paid the fees you'd need to draw up a contract. If you then didn't pay the fees the seller would need to take you to court to claim them. But I'm not sure how a judge would look upon a contract that was agreed to (essentially) defraud HMRC, or even it's validity.

SeaVixen wrote: »

2. I have found a building society which I can transfer my H2B ISA into, that offers a 10% bonus when you buy a house (of any value). The interest rate isn't as good as my current one, but I could transfer the ISA when we have an offer accepted and get the bonus. Has anyone seen any accounts with better bonuses or other benefits?

That's a pretty good bonus. I assume the 10% is of what you have saved so far? If you have been saving since they launched you must have £7000+ (or double that if you both have one) in there, so an extra £700, at least, will more than make up for lost interest.

Who is the BS out of interest? They may have Ts&Cs that say how long you have to save with them to get it. Be worth checking that out before you transfer.

SeaVixen

Thanks for the reply mije1983.

The bit about paying the agency fees is particularly helpful - I thought this might be the answer. I only asked as I feel like I've read about other people doing it, but I can't find it now so think I might have dreamt it.

Re: the figures I mentioned, these were likely accepted offer guesstimates, rather than asking prices. Lots of places were looking have "Offers over" rather than a standard asking price, which I'm finding a little frustrating.

The building society offering the 10% bonus is The Vernon. You have to live within 25 miles of Stockport to have an account with them, which we just about do. I did ask if there were any restrictions about having the account open for so long before getting the bonus, but apparently there aren't.

You're right about having around £7k in the ISA, and the bonus cancelling out lost interest. I'm going to transfer it shortly just in case they stop the deal, regardless of there being no time frame on the account.


I'm also considering opening a LISA next week just in case it takes us over a year to find a house and exchange. I'm really hoping it won't, but if I've got one open with £500 in I could put £3,500 just as its about to cross the 1yr point. This would give us a £1k bonus. Maybe 2k if it goes a year and a month over, and we put the second year's 4k in straight away.

Have yet to check the T&C on this, but if we claim the H2B bonus via the LISA, we might still get the 10% from Vernon, as this doesn't have a house price limit on and I assume is completely separate from the government bonus.

Wish I'd worked that out 10 months ago !!!55357;!!!56834;

studentguy

I'd look carefully at the lifetime isa terms. IIRC the bonus used to be paid in April every year, e.g if you put money in on May you wouldn't get the bonus till the April the year after, I think that changed recently though but double check

SeaVixen

Thanks for the heads up!
I can't see anything about that on the LISA I've gone for. It's a cash one rather than stocks and shares, so maybe that has something to do with it?

gatters

Regarding the Vernon account, from their website...

When used for the deposit on a house the Government will pay a bonus of 25% on your final balance (min £400 max £3,000). What!!!8217;s more, if your mortgage is with us, we will pay an additional bonus of 10% on your final balance (min £160 max £1,000) provided you have held a Help to Buy: ISA with us for a minimum of 6 months. /QUOTE]

Don't limit your mortgage search just for a £700 bonus.

The LISA plan in case of a 12m+ wait is worth a thought, to clarify;
-The bonus is paid monthly on what you pay in, credited in 4/9 weeks.
-The £4k limit is per tax year so you could have £8k +£2k bonus in it within 12m.
-Your initial deposit to get the 12m clock started doesn't need to be as much as £500, £1 would probably do.

pink_pirlie

studentguy wrote: »

I'd look carefully at the lifetime isa terms. IIRC the bonus used to be paid in April every year, e.g if you put money in on May you wouldn't get the bonus till the April the year after, I think that changed recently though but double check

LISA must be open a year before you can withdraw penalty free towards a qualifying house purchase.

Bonuses are paid monthly now.
Deposits before 6th (ish) of the month will be paid towards the end of the following month.

You also need to factor in c30 days for the LISA provider to send the funds to your solicitor.