I've had a few clients recently who have been left feeling confused by the Help to Buy ISA and how to use it. To help guide you through; I've compiled a list of the questions and answers that we come across regularly...
Do you have to use the Help to Buy ISA to purchase a new build?
You can use the Help to Buy ISA for any qualifying property. The property does not need to be a new build. The only requirements are that:
- The property must be in the UK
- The purchase price of the property must not exceed £250,000.00 (or £450,000.00 in London)
- The property must be purchased with a Mortgage
- The property must be the only home you will own and be where you intend on living.
Do I need to close my Help to Buy ISA as soon as I put an offer on a property?
No. It can take several weeks to complete a conveyancing transaction and you should therefore make as many additional payments as you can to take advantage of a higher bonus.
Although I would advise you to check how long it will take to obtain the Help to Buy ISA closing letter from your bank, to ensure you will not delay matters once a completion date is known.
How to close my ISA account?
As a client you need to close your Help to Buy ISA account yourself. You should contact the bank where you hold your Help to Buy ISA for guidance, but most people go into the branch and close the account. The bank will supply you with a closing letter which you must supply to your Conveyancer along with the completed First Time Buyer Declaration which your Conveyancer will supply to you.
How long until I get my ISA closing letter?
Please note that some banks let you have the Help to Buy ISA closing letter right away. But it can sometimes take longer... I've recently had a client where it took two weeks for him to receive the letter.
How do we get our Help to Buy ISA Bonus?
Once you have closed your ISA account, you will supply your Conveyancer with the closing letter along with the First Time Buyer Declaration.
This First Time Buyer Declaration is the document signed by you; confirming details of the property and acknowledging that you have abided by the schemes rules and are eligible for the Help to Buy bonus.
Your Conveyancer will upload these two documents to the Government Portal and request the draw-down of your Help to Buy ISA bonus.
The money which you have been saving each month is dealt with by your bank but the Help to Buy ISA bonus is sent directly to your Conveyancer. The Help to Buy ISA bonus cannot be sent directly to you and cannot be requested following completion.
What can we use the bonus for?
The Help to Buy ISA bonus must be used towards the purchase price and cannot be used for any other purpose, including our fees. As the bonus is only available on completion this cannot be used towards the deposit.
You can find further information on the Help to Buy ISA webpage www.helptobuy.gov.uk.