HTB ISA Gov't Bonus and Deposits

Saga

Is it wrong to include the 25% government bonus for a HTB ISA when calculating how much one has available for a deposit? When I say 'wrong', I mean because the funds might not be realised before either the 10% exchange deposit is due or the when the remainder of the mortgage deposit is due.

Specifically, in one calculation if I disregard the value of my HTB bonus, my deposit will be 19% of the asking price, whereas if I include the bonus it will take me over the 20% threshold and therefore possibly eligible for better mortgage rates.

iampetesmith

When we had ours, it sort of went towards the deposit but it's not supposed to. I think it depends on how the solictor works and how they claim the bonus.

Some solicitors (like ours) calculate the bonus when you send them the closing statements, then they take the bonus off the final bill that you pay to exchange and claim the deposit themselves afterwards. This means that we paid less to exchange, so it was either knocked off the deposit or it covered the legal fees (whichever way you want to look at it).

Other solicitors will take the full amount for the deposit and fees, then claim the bonus and refund you the amount after completion. This would mean that the bonus doesn't actually go towards the deposit as you pay the full amount before you get it.

You might be able to call the solicitor and explain that you want to use the bonus towards the deposit, then they might do what they did with us and knock it off the final bill so you pay less at exchange.

Saga

Thanks. What you say confirms my reason for asking, i.e. that the bonus is accessed at different times that it's not clear if it can be counted as part of the deposit when trying to obtain a mortgage.