Has juggling the cost of Christmas at the same time as saving a deposit become a challenge? Well don’t fret because this December the Government have launched the new Help to Buy ISA.
Designed to boost your savings, the Government will add 25% to whatever you save; on a maximum of £12,000. For example if you save £200 a month, the Government will give you an additional £50 each month.
This means if you save £5,000, the Government will top you up to £6,125. Save £10,000 and you’ll get topped up to £12,500.
The Help to Buy ISA launches on the 1st December and runs until 1st December 2019: it will be available from a selection of high street lenders including Barclays, Lloyds, Nationwide, NatWest, Santander and Virgin Money.
The Help to Buy ISA is an individual product, like any other ISA, so if you’re saving a deposit with a partner you can both save in to a Help to Buy ISA; this way your maximum joint bonus would be £6,000.
In the first month you can kick-start your savings by putting up to £1,200 into the ISA, after which the maximum monthly contribution is £200. You can miss making a contribution in any months that you can’t do it but you won’t be able to make up for it the following month, i.e. if you don’t save in May, you can’t save £400 in June, just the £200.
The ISA can only be used by first time buyers to purchase a property, and the great news is that you also use it towards saving for a deposit for a Shared Ownership property too!
For example, our average minimum deposit required to buy a Radian Homes Shared Ownership home is around £5,000. That means you’ll need to save £3,750 and the ISA will be be topped up with £1,250 from the Government.
Further information, including eligibility criteria, can be found here