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Help to buy isa bonus
Sphere2023
Posts: 1 Newbie
My son is buying his first property funded from savings, inheritance and a loan from us, his parents. Will he still be eligible for the govt. bonus on his help to buy isa if he is not having a traditional mortgage with a bank or building society? Does our loan count as a mortgage? Thanks for any advice.
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Sphere2023 said:My son is buying his first property funded from savings, inheritance and a loan from us, his parents. Will he still be eligible for the govt. bonus on his help to buy isa if he is not having a traditional mortgage with a bank or building society? Does our loan count as a mortgage? Thanks for any advice.
Help to Buy ISA's are no longer available to new applicants, so I'm not sure if the rules have changed at all over the last few years, but it was a rule of the scheme that in order to claim the bonus on completion, the first time buyer took out a mortgage. If it is still applicable then it might be a good idea for your son to buy with a mortgage on a fixed rate for 2 years, then repay it in two years time.
Mortgage lenders accept Gifted Deposits from relatives, i.e. parents, but they do not like "Loans", so best not to lend him the money until the lender's mortgage is paid off. A Gifted Deposit would mean that you give your son the deposit money without expecting it to be paid back, i.e. not a loan.
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