Help to buy versus regular ISA if not looking to buy....

Hollah21

Hi,

Is it better to get a help to buy ISA compared to a regular cash ISA even if not looking to buy (and so get the extra towards a deposit) just because the interest rates are better than regular cash isas?! Are there any draw backs to doing this? As far as I can see you don't need to use the help to buy Isas to actually put towards a deposit. So unless there are any downsides is it not better to put savings into a help to buy??

Thanks!

eskbanker

The main downside to HTB is the stingy £200 monthly limit to contributions after the first month, but if you're planning to save less than that and haven't owned a property then there's nothing stopping you from using a HTB ISA purely for the better interest rate.

20SmthngSver

Depends on what you can afford to save each month? Help to Buy ISA's are giving better rates than Cash ISA's at the moment. You can still save £3400 the first year and £2400 per year afterwards.

Depends on your circumstances and budget. A Help to Buy ISA is instant access, can withdraw or close any time. You just can't replace what you've taken out. And it doesn't have to be for a house. If you choose not to, you just don't get the Government bonus for it.

Help to Buy ISA's are being withdrawn from sale this coming November 2019, but you can still save into them after this point. Maybe it's worth at least opening it just for that.

Hope this helps.

gingercordial

Hollah21 wrote: »

Hi,

Is it better to get a help to buy ISA compared to a regular cash ISA even if not looking to buy (and so get the extra towards a deposit) just because the interest rates are better than regular cash isas?! Are there any draw backs to doing this? As far as I can see you don't need to use the help to buy Isas to actually put towards a deposit. So unless there are any downsides is it not better to put savings into a help to buy??

Thanks!

I have a HTB ISA as they tend to have higher interest rates, though almost certainly will not be using it for the house purchase I'm hoping to make next year because in my part of London there's nothing below the threshold. The advantage of this over a LISA for me is that I can take it out with no penalty even though not buying a "qualifying" house.

The contribution limit is low but I have mine at Nationwide so can split my ISA allowance between HTB and another from them.