LISA Release

Preface12

I wonder if anyone can shed some light. So we opened our LISA early Feb last year and we are FTBs and obviously intend to use it towards our first home. Can we only use it towards our first home in Feb or can we reserve a house and asked for the funds to be released then to avoid paying the fee or should we just wait it out? Apologies for my ignorance. 

se2020

Your solicitor needs to request the money out of a LISA. If you take it out before fed you will have to pay the fee and loose all the bonuses you have been paid.
There is currently a temporary (due to corona) allowance for you to withdraw the funds without paying the fee but a mortgage company might not be happy if you say you need to take the money back out. 

Preface12

I see. We do wish to get all the bonuses so it'll have to be Feb. If we happen to find a property we like that's still being built can we reserve and request for funds to be transferred by Feb date or that's not allowed? I guess it'll depend on the developer. It is my understanding that if we reserve we have 4 weeks to complete all paperwork.

BristolPole

@Preface12 You can definitely ask, but having been in your position not too long ago we were given a 'no' by the developer. Delaying the release of funds would mean delaying the exchange and I think very few (if any) developers would like that. There might be a little bit more leeway if you reserve in, say, December, where the delay would only be an extra few weeks as opposed to months. If you do end up in a situation like that, then you / your solicitor can kick the process off with your LISA provider before February and go all the way to the stage of releasing the money, at which point you can agree with the provider for that to happen on the same day that your LISA 'matures' (at least that's what I was told by Moneybox, worth checking with your own provider if it's someone else).

Preface12

@BristolPole . Thanks for the advice. Thanks guys for your feedback. We will discuss this with developer come December and see what happens.