Help to Buy ISA guide

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  • RainTown
    RainTown Posts: 3 Newbie
    edited 20 April 2018 at 12:52PM
    Lifetime ISA not an option for me as I am not considered a "young person".

    S&S ISA not an option I am considering.

    Nationwide's new(ish) "Single Access ISAs" seem to offer me the best I can get for now, as I can continue to pay into HTB and have decent interest rate on Cash ISA.
  • Rich2808
    Rich2808 Posts: 1,312
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    RainTown wrote: »
    But can I open a second HTB ISA with second provider (one who would also offer a Cash ISA)?

    I presume not, so I am stuck between sticking with Nationwide to be able to continue to top up the HTB ISA, and accepting the poor interest rate on their cash ISA, or opening and transferring to new cash ISA while freezing HTB ISA at Nationwide?

    RT

    Nationwide pays 2% on their HTB isa – which is not that bad. And as well as being a flexible isa provider and a split isa provider also allows you to fund your help to buy isa with prior year isa funds. So you don’t need to use your 2018-19 allowance – you can simply transfer in prior year funds online monthly via their online transfer system to fund your HTB isa (although its easier if you have the other isa(s) with them).

    Its really up to you whether a slightly higher rate is better than administrative flexibility in terms of your isa holdings.

    PS I agree its rather unfair the lifetime isa isn't available to FTBs over 40 - if nothing else because of the £450k property purchase limit outside London. Finding homes under £250k isn't easy in the south east!
  • I'm looking to buy a home with my partner in 2+ years. She has a Help-to-Buy ISA. I've compared Lifetime ISA's and Help-to-Buy ISA's, it seems that Lifetime ISA's are generally better for first time buyers who can avoid touching the money.

    I can see that 2 people who buy together can both use their Help-to-Buy ISA's in conjunction when buying, and both receive the 25% bonuses. But if I open a Lifetime ISA, can it be used along with my partner's Help-to-Buy ISA so we both receive the bonuses?

    Thanks in advance!
  • eskbanker
    eskbanker Posts: 30,430
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    cafrenchie wrote: »
    I'm looking to buy a home with my partner in 2+ years. She has a Help-to-Buy ISA. I've compared Lifetime ISA's and Help-to-Buy ISA's, it seems that Lifetime ISA's are generally better for first time buyers who can avoid touching the money.

    I can see that 2 people who buy together can both use their Help-to-Buy ISA's in conjunction when buying, and both receive the 25% bonuses. But if I open a Lifetime ISA, can it be used along with my partner's Help-to-Buy ISA so we both receive the bonuses?
    Yes, for a couple who are both first time buyers, one can use a HTB and the other a LISA, both obtaining bonuses by doing so.
  • cdewd
    cdewd Posts: 2 Newbie
    Hello, I recently transferred my Halifax Help to Buy ISA into a Skipton LISA. Unfortunately I have oversubscribed by £2500 as I had £6500 in my Help to Buy ISA and didn't realise I could only transfer up to £4000 (partly because I had already paid into the HTB ISA within the 2017/18 tax year).

    I was wondering what I should do with the extra £2500 - should I open a new Help to Buy ISA (my Halifax one is now closed)?

    Thanks
  • eskbanker
    eskbanker Posts: 30,430
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    cdewd wrote: »
    I recently transferred my Halifax Help to Buy ISA into a Skipton LISA. Unfortunately I have oversubscribed by £2500 as I had £6500 in my Help to Buy ISA and didn't realise I could only transfer up to £4000 (partly because I had already paid into the HTB ISA within the 2017/18 tax year).
    How recently did you transfer? If you used Skipton's published process to initiate the transfer before 1 March then your pre-17/18 HTB contributions didn't count towards the £4K annual LISA limit and it was therefore possible to transfer significantly more than £4K.
    cdewd wrote: »
    I was wondering what I should do with the extra £2500 - should I open a new Help to Buy ISA (my Halifax one is now closed)?
    You can open another HTB ISA but you couldn't use both it and the LISA for a 25% bonus on a first-time property purchase. Your £4K LISA allowance would have reset on 6 April so if the transfer was before that then you can put the whole £2500 into the LISA now.
  • cdewd
    cdewd Posts: 2 Newbie
    eskbanker wrote: »
    How recently did you transfer? If you used Skipton's published process to initiate the transfer before 1 March then your pre-17/18 HTB contributions didn't count towards the £4K annual LISA limit and it was therefore possible to transfer significantly more than £4K.

    Thanks, I did use the Skipton's published process - I think the problem may be that I contributed £2400 into my help to buy ISA in 2017/18 (i.e. £200 per month as the maximum) am I right in thinking that this money cannot be transferred into the LISA as then I am effectively paying into 2 ISAs in one year? However I did think you could pay into a LISA and a Help to Buy ISA so I'm still slightly confused. The only other factor may be that I have also transferred £4000 from a barclays cash ISA into the LISA, would this have affected things? Thanks
  • eskbanker
    eskbanker Posts: 30,430
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    cdewd wrote: »
    Thanks, I did use the Skipton's published process - I think the problem may be that I contributed £2400 into my help to buy ISA in 2017/18 (i.e. £200 per month as the maximum) am I right in thinking that this money cannot be transferred into the LISA as then I am effectively paying into 2 ISAs in one year? However I did think you could pay into a LISA and a Help to Buy ISA so I'm still slightly confused. The only other factor may be that I have also transferred £4000 from a barclays cash ISA into the LISA, would this have affected things? Thanks
    Ah yes, another source of funding for the LISA would certainly have conflicted - the rule up to 5 April 2018 was that you could transfer in all pre-17/18 HTB money without affecting your £4K 17/18 LISA allowance, but yes, you weren't allowed to pay into a LISA both £2400 of 17/18 HTB money and another £4K from elsewhere as well.

    You can open another HTB but you'd be starting again from scratch with the £1K initial deposit and then £200/month thereafter, rather than being able to transfer in a lump sum, or alternatively pay it all into the LISA against your 18/19 £4K allowance.
  • I have become a trustee along with other family members of my Mums house and am a bit confused as to whether I can still be classed as a first time buyer, I’ve been saving into a help to buy ISA and am looking to buy this year. On the one hand it seems I am but it says about being a beneficiary in the future, I just wondered if anyone can clarify the beneficiary part for me?! I don’t earn or receive anything from the house as a trustee. Thank you
  • BazF
    BazF Posts: 1 Newbie
    edited 24 April 2018 at 6:03PM
    Have to say how frustrated I am that after saving £7,000 in my Santander H2B ISA that Im now not entitled to any bonus because our house is £314,950 in West Sussex. Id like to see what house the person in government who decided the cap is £250K outside London as you cant get much for that other than a complete dive of a shoebox.

    So frustrating!!
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