Help To Buy ISA Bonus

iKarlCPFC

Hi All,

I cannot find a straight answer for this so best ask here.

Simply put can I use my H2B ISA Bonus for my house deposit?

If I want to purchase a £340k house and already have the £34k deposit can the ISA Bonus be used to increase my offer?

Tiglet2

From the Help to Buy website:

When you are close to buying your first home, you will need to instruct your solicitor or conveyancer to apply for your government bonus. Once they receive the government bonus, it will be added to the money you are putting towards your first home. The bonus must be included with the funds consolidated at the completion of the property transaction. The bonus cannot be used for the deposit due at the exchange of contracts, to pay for solicitor’s, estate agent’s fees or any other indirect costs associated with buying a home.

iKarlCPFC

Tiglet2 said:

From the Help to Buy website:

When you are close to buying your first home, you will need to instruct your solicitor or conveyancer to apply for your government bonus. Once they receive the government bonus, it will be added to the money you are putting towards your first home. The bonus must be included with the funds consolidated at the completion of the property transaction. The bonus cannot be used for the deposit due at the exchange of contracts, to pay for solicitor’s, estate agent’s fees or any other indirect costs associated with buying a home.

I saw this but then the H2B website also says this:

Does the Help to Buy: ISA bonus contribute towards the deposit I need to buy my first home?
Yes. The government bonus contributes towards your overall deposit (sometimes referred to as the ‘mortgage deposit’) and therefore increases your savings for your first home.

grumiofoundation

I cannot find a straight answer for this so best ask here.

Simply put can I use my H2B ISA Bonus for my house deposit?

Key is what you mean by deposit. 

Deposit at completion - yes.

Deposit at exchange - no.

See point 5 in this article.
https://www.moneysavingexpert.com/savings/help-to-buy-isa/

If I want to purchase a £340k house and already have the £34k deposit can the ISA Bonus be used to increase my offer?

I guess you mean you currently have a 34k deposit, including 12k in HTB ISA? (not including solicitor fees etc)

Assuming you are not limited by mortgage amount you could theoretically buy a 370k house with a 333k mortgage (90% LTV) and a 37k deposit (34k plus the 3k HTB ISA bonus). 

Seller would need to agree to accept less than the normal deposit as exchange (9.2% versus 10%). 

Note - this all assumes you are in London - if not you can't use your HTB ISA bonus - outside London price limited to 250k

iKarlCPFC

Okay, that makes sense. Thanks.