HTB ISA bonus payment clarification

hotnoise

Apologies for what is probably a silly question - as a first time buyer, I'm just trying to clarify details to better understand the whole process.

I'm using the HTB ISA to go towards my deposit on a new build apartment. I've read on MSE that the bonus payment isn't paid until completion and wondered how this works? I assume I cover the bonus payment with my own funds for the purposes of paying the deposit at exchange, but then what happens at completion? Is the equivalent amount refunded back to me?

iampetesmith

I think it depends on your solicitor and how they handle it, so you could ask them how they do it.

We used Premier Property Lawyers and they requested the bonus from the government at exchange (when I paid the final bill), but they worked out what amount the bonus would be beforehand and knocked it off the final bill.

This means that technically our HTB bonus went towards the deposit as the final bill included the deposit for the house and their fees, so the HTB bonus was deducted from that.

I think some solicitors take the full amount and then refund you the bonus when they get it, so it all depends how yours works.

Tiglet2

Your agreed deposit (5%/10%) has to be paid in time for exchange.  The firm I work for will apply for the bonus on exchange and then add the bonus to the final account as a credit.  It just means that the monies they require to complete will be the total costs, minus the bonus.  In effect, it reduces the amount of money you have to pay them on completion (i.e. their fees).

DCFC79

From what I know, my solicitor has asked me to close my HTB when she informs me to do so and transfer x amount, as to where the bonus comes i to it I dknt know, Im guessing the solicitor will get it from the government/the HTB scheme provider.

Sncjw

Nationwide has said they add the bonus payment to the total deposit amount. I’ve stated this on the solicitor paperwork that I’m using it towards deposit. 

If needs be I will have to borrow money from my mother to make the total cost 

Tiglet2

The bonus payment cannot be used towards the deposit, because the solicitor doesn't apply to get the bonus from the government until after exchange takes place.  The bonus will be put towards the completion monies.