In his last Budget, George Osborne set out more plans to help first-time buyers – this time in the shape of a new savings scheme.
Almost 83,000 households have already bought a home through the original Help to Buy scheme. Demand is obviously there for first-time buyers, so the Help to Buy Isa is a way to encourage more to save for buying a house.
Here’s what your clients will need to know about the HTB Isa.
What do you get?
The HTB Isa is essentially a cash Isa with a government bonus. For every £200 saved, £50 is given from the government. However, this is only up to £3,000. So, if customers save £12,000, the bonus will boost savings to £15,000. Also, the government contribution is only paid on completion of a house purchase, so homebuyers will have to fund a deposit themselves before receiving the bonus.
What do you need?
There is no minimum monthly deposit, but you can save up to £200 a month. The bonus is available on homes up to £450,000 in London and £250,000 outside London.
Who is it available to?
The bonus is available to any first-time buyer purchasing a UK property. It is only available to individuals 16 and over. You can only open one account per person, but it is not limited to one per home. This means partners can also save and receive the bonus, making a bigger savings pot.
How long is it available for?
Opening new accounts will be available for four years, but once an account is open, there is no limit on how long you are able to save for.
How do I get one?
HTB Isa accounts will be available through banks and building societies from Autumn 2015. Although keep in mind you cannot have a HTB Isa as well as a cash Isa.
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