If you are saving to buy your first home, save money into a ‘Help to Buy: ISA’ and the Government will boost your savings by 25%. So, for every £200 you save, receive a government bonus of £50. The maximum government bonus you can receive is £3,000.
1. Open: the ‘Help to Buy: ISA’ is available from a range of banks, building societies and credit unions.
The accounts are available to each first-time buyer, not each household. This means that if you are planning to buy with your partner, for example, you could receive a government bonus of up to £6,000 towards your first home
2. Save: Save up to £200 a month into your ‘Help to Buy: ISA’. To kick start your account, in your first month, you can deposit a lump sum of up to £1,200.
The minimum government bonus is £400, meaning that you need to have saved at least £1,600 into your Help to Buy: ISA before you can claim your bonus. The maximum government bonus you can receive is £3,000 – to receive that, you need to have saved £12,000
3. Receive bonus: When you are close to buying your first home, you will need to instruct your solicitor or conveyancer to apply for your government bonus. Once they receive the government bonus, it will be added to the money you are putting towards your first home. The bonus must be included with the funds consolidated at the completion of the property transaction. The bonus cannot be used for the deposit due at the exchange of contracts, to pay for solicitor's, estate agent's fees or any other indirect costs associated with buying a home.
To qualify for a ‘Help to Buy: ISA’ you must:
Be 16 or over
Have a valid National Insurance number
Be a UK resident
Be a first-time buyer, and not own a property anywhere in the world
Not have another active cash ISA in the same tax year: If you have opened a cash ISA this tax year, you can open a ‘Help to Buy: ISA’ but will have to take additional steps
Be in the UK
Have a purchase price of up to £250,000 (or up to £450,000 in London)
Be the only home you will own
Be where you intend on living
Be purchased with a mortgage