Help to Buy
Help to Buy schemes have been greatly expanded recently and can now provide financial help to a wide range of potential buyers.
At Andrew & Andrew Solicitors, we are experienced in all Help to Buy schemes and can provide you with comprehensive advice and guidance from instruction to completion.
You may be able to get financial help from the government to buy a home using either the Help to Buy ISA or Help to Buy equity loan, as explained in more detail below.
Help to Buy ISA
The Help to Buy ISA is a tax-free savings account aimed specifically if you are saving to buy your first home.
The initial step is to open an ISA with a qualifying bank or building society. Should you decide to use the savings in your ISA towards the purchase of your first home, the government will increase your savings by 25%.
A few important things to note:
- You must be aged 16 or over, have a valid National Insurance Number, be a UK resident and a first time buyer – not owning another property anywhere in the world.
- As an incentive, in your first month, you can deposit a lump sum of up to £1,200. Thereafter, you can save up to £200 per month.
- So, for every £200 you save, you will receive a government bonus of £50.
- The minimum government bonus is £400, meaning that you will need to have saved at least £1,600 before your bonus can be claimed. The maximum government bonus you can receive is £3,000.
- To qualify for the government bonus, the property you are buying must be in the UK, have a purchase price of less than £250,000 (or up to £450,000 in London), be where you intend on living and be purchased with the aid of a mortgage.
Once you are close to exchanging on your first home, Andrew & Andrew Solicitors will instruct you to close your ISA and request that you provide us with a closing statement from the provider, so we can apply for your government bonus.
Once we receive the government bonus, it will be added to the money you are putting towards your first home. The bonus cannot be used for the deposit due at the exchange of contracts, as the bonus is only paid on completion.
You will be able to open a Help to Buy ISA until 30th November 2019.
The government bonus can also be claimed in conjunction with other government schemes; including the Help to Buy equity loan and the purchase of a shared ownership property.
Help to Buy equity loan
The Help to Buy equity loan is one of the most popular methods to get on the property ladder, if you wish to buy a newly built home.