100% mortgage and help to buy ISA if not using isa for deposit

mihaicraciunph

We are buying a house under the shared ownership scheme and we both have a help to buy ISA.

When we first started talking to the association to buy the house we had a decent deposit, but in the mean time my mum decided to get into stupid debt (think payday loan of ~4k) so I had to pay that off for her, and my partner paid of his car as the housing association mentioned it would "increase our chances", so now our deposit is only about 10-12k left.

Our mortgage adviser said she'll try to get a 100% mortgage instead and save our deposit for other things, or use a higher deposit when we re-mortgage in a couple of years time. This didn't seem to bad even though it's a higher interest mortgage - extra money to fall back on and better chance to buy a higher share in a couple of years. I only finish uni in a couple of years and qualify on hopefully 40-50k salary, and so will my partner, so at the moment our income is about 40k combined. Still paying less than renting and it's closer to my uni and his work so all in all not too bothered.

Question : So if we do go for a 0% deposit mortgage, can we still get the bonus from the help to buy ISA? The T&Cs don't say much so if we can still get the 25% bonus and use that to make our mortgage lower then will the solicitor be able to do it? I was gonna ask them direct but they decided to go on holiday until end of the week.

Question 2: Previous solicitor (we had to change to be approved by the lender ) said you can use the help to buy ISA if the share we buy is below the 250k maximum price, but I always thought it's the full price of the house? (shared ownership)

Question 3: are 100% mortgages that bad as some people have said? We'd end up paying less / month than if we were renting and in a couple of years we will be in a much better financial position to remortgage, and then buy 100% of the house in about 4-5 years: that is the plan

stevenhp1987

a) Where can you get a 100% LTV mortgage? The "100% LTV mortgages" on offer are really a "deposit" from their parents. I know of zero lenders that offer a 0% deposit mortgage. It's simply too big a risk on the lenders part.

b) Help to buy ISA bonus can only be received if you use the HTB ISA as part of the deposit. 0 deposit = 0 bonus.

Teamocil

I didn't use all the money in my Help to Buy ISA for my deposit but got the full bonus. The bank just sent it into my current account, I paid the balance of the deposit (which having already paid the exchange deposit was less than I had in my HtB ISA) and my solicitor claimed the bonus.

csgohan4

Having a lower deposit may hit your affordability, getting a 100%mortgage now a days is uncommon

kingstreet

There is at least one lender offering 100% mortgages on shared ownership.