InvestmentsNov 2 2015

Osborne clarifies how Help to Buy Isas will work

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Osborne clarifies how Help to Buy Isas will work

“Easy steps” have been confirmed by chancellor George Osborne for first-time buyers looking to collect a government bonus from the Help to Buy Isa.

Yesterday (1 November) he said that when savers with a Help to Buy Isa close their account to buy their first home, they will receive a closing letter from their Isa manager.

This letter should then be given to their solicitor who will apply online for the bonus. When received, the solicitor should then use this to purchase the home.

Mr Osborne stated: “We’re just one month away from the launch of the Help to Buy Isa which will provide extra help for working people who want to buy their own home.”

Initially announced in the Autumn statement last year, the Help to Buy Isa will be available from 1 December and allows first-time buyers to save up to £200 a month.

The government has pledged to top these savings by 25 per cent up to a maximum of £3,000. Couples buying together will also be able to combine their bonuses, meaning a potential boost of up to £6,000 towards a deposit for a first home.

First-time buyers can also open their account with a one-off lump sum of up to £1,000 in addition to the monthly maximum.

Back in July, HM Treasury confirmed that six lenders signed up to the Help to Buy Isa scheme, which will be available from 1 December 2015.

Nationwide, Barclays, Lloyds Banking Group, Natwest, Santander, and Virgin Money will all be offering the new Help to Buy Isa.