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    • cookie666
    • By cookie666 8th Feb 18, 9:25 AM
    • 229Posts
    • 2,258Thanks
    cookie666
    Help to buy ISA confusion
    • #1
    • 8th Feb 18, 9:25 AM
    Help to buy ISA confusion 8th Feb 18 at 9:25 AM
    I was speaking to a friend who is due to buy a house shortly and asked him whether he had the HTB ISA in place that gives him the 25% bonus for first-time buyers.

    He responded that he would not touch it as "you could end up paying back loads in the future, the government also owns a quarter of the property"

    This has confused me as I thought the scheme just meant to give new buyers a boost and that it was not a loan.

    I've Googled around but can't see anything that states what he's talking about, other than maybe a Help to buy loan?

    https://www.money.co.uk/guides/what-are-the-pros-and-cons-of-the-help-to-buy-scheme.htm
Page 1
    • Britnall7700
    • By Britnall7700 8th Feb 18, 9:29 AM
    • 29 Posts
    • 5 Thanks
    Britnall7700
    • #2
    • 8th Feb 18, 9:29 AM
    • #2
    • 8th Feb 18, 9:29 AM
    Yeah, two different schemes.
    • whatdoyouthink...
    • By whatdoyouthink... 8th Feb 18, 10:23 AM
    • 55 Posts
    • 24 Thanks
    whatdoyouthink...
    • #3
    • 8th Feb 18, 10:23 AM
    • #3
    • 8th Feb 18, 10:23 AM
    He's not talking about the HTB ISA. The ISA basically gives you 25% of the closing balance as a bonus...make sure you close the account and forward the closure document to your solicitor before completion of the house purchase!
    • scottishblondie
    • By scottishblondie 8th Feb 18, 10:48 AM
    • 2,004 Posts
    • 1,295 Thanks
    scottishblondie
    • #4
    • 8th Feb 18, 10:48 AM
    • #4
    • 8th Feb 18, 10:48 AM
    Your friend has confused the HTB ISA scheme, where you get a boost on your deposit savings of 25%, and the HTB Equity Loan scheme where they will boost your deposit by up to 20%. Even then he's a bit off - the HTB Equity Loan tops up your deposit so you can get a cheaper mortgage (or afford to buy at all) and of course that comes at a cost. You have to repay the loan as a percentage of your property value rather than a fixed amount or at a fixed interest rate, so in a way they do "own" a percentage of your property and if the value goes up a lot you could end up paying back a lot more than the initial amount you borrowed.
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