Help to Buy schemes

Posted On 02 November 2023 by Richard Berry
Help to Buy schemes

Help to Buy Schemes

Welcome one and all to our Blog which will give a brief look into three schemes available to some buyers to assist with First Time Buying. We will briefly cover the Help to Buy ISA Scheme, the Lifetime ISA Scheme and the Forces Help to Buy Scheme.

As we all know buying a home can be especially trying, even more so for a first-time buyer. We hope that our overview below will be of benefit.

The Help to Buy ISA

This is a savings ISA which when used to purchase a property, as a first-time buyer you gain a 25% bonus on the amount you save up to a maximum of £3,000.00.  When you claim your bonus, you will need to shut the account completely.

The money in the ISA can be used towards the deposit for exchange or towards completion, however the bonus itself must be used for the house completion.

Unfortunately, you can no longer open a Help to Buy ISA although existing ones can be paid into until November 2029 and you can claim the Government bonus up to November 2030.

The Lifetime ISA (LISA)

As there appears to be no current plans to replace the Help to Buy ISA so this would be the next option.

This differs to the Help to Buy ISA in that the LISA does not need to be closed, it can be used to help purchase your first home or you can save towards later life.

To open a LISA you must be over 18 years of age and under 40 years of age, you will receive from the Government a bonus of 25% of your savings up to £1,000.00 a year.

To use your LISA for the purchase of a property the value of the property must be no more than £450,000.00 and if you are buying jointly, you must both be first time buyers. Your solicitor will communicate with you LISA provider and the funds will be paid to them.

Forces Help to Buy (FHtB)

As suggested by the name this scheme is open to current serving members of the armed forces.  This scheme allows forces personnel to borrow up to 50% of their salary up to a maximum of £25,000.00 which must be used towards the home purchase.

FHtB can be used for the deposit upon exchange or towards completion including solicitors’ fees. Although FHtB is mainly for first time buyers it is possible under certain circumstances to be considered for it if you have owned a property before.

Of course, there are criteria to be met when applying for this scheme, as with any, and we recommend you contact the Joint Personnel Administration Cell (JPAC) with any queries as to eligibility.

Unlike the previous two schemes FHtB will need to be repaid and you will be required to repay it before you leave the service.  It will be expected to repay this over 10 years at a monthly rate. You will be able to make over payments on this. 

Final Note

As promised, this has been a brief overview and of course we recommend as with all financial matters you seek expert advice.

If we can assist you with your purchase please contact our residential property team on 01823 446200

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