Help to buy, Government giving you money to buy a house.
It’s a common problem nowadays, with the soaring cost of house prices, many of us can only dream of owning our own home, saving the deposit alone can be a daunting task in itself, many places want at least a 20% deposit, though first time buyers can sometimes get a 5% deposit this is getting rarer and means you have more to pay off. Now from the 1st of December last year the Government are rewarding first-time buyers as they try to save. A new ISA called help to buy has been launched, available in all banks and building society’s it actually pays you to save money for the deposit on your house.
Each month you can deposit up to £200 into the ISA, and if you do the government will give you £50, that’s right they will give you £50 no strings attached. The first payment can be up to £1200, if you have that in another account then it might be worth switching it as you will get the bonus of £300 for doing so. The good thing is this is not a locked in ISA, if you suddenly find yourself short for whatever reason and need to withdraw the cash you can do so, but you can only put a maximum of £200 each month so if you withdraw it, it might take you a while to top it back up. The bonuses will continue until the government have given you £3000 so a 25% contribution when you have saved £12,000
There is also another way that you can maximise the savings. If you have a partner or spouse, they can also open up an ISA under their name. If you both put £200 into your respective accounts you can be £100 better off a month or a whole £6000 courtesy of the government, gaining an extra £50 a month up to the lever of £3000 is a nice bonus from the government and well worth looking into as an alternative means of saving for one of the most important purchases of your life.
The government don’t actually put the money into your bank account but rather apply the credit you have earned towards the cost of your house when you go to buy it so it can only be used for buying a house.
There are some restrictions but they are the standard ones such as being over 16 and a resident of the UK, you also can’t own any property either abroad or in the UK as this is strictly for first-time buyers.
The property can cost up to £250,000 pounds or up to £450,000 if you’re buying in London and buy to let and rent to buy properties are excluded from the deal.
This is something you are saving towards then it might be well worth popping into your local bank and asking how you can sign up to one.
By The Coupon Detective.