The help to buy ISA is a government backed scheme to help first time buyers save for the deposit on their first home. The ISA can be opened at most banks and the individual would save as they would with a normal ISA account. However, with the help to buy ISA the government assists by putting in an extra 25% towards their savings. The maximum bonus they can receive is £3,000 and they can only apply for the deposit once they have saved over £1,600. In addition, this would only apply to homes being purchased under £250,000 unless they are purchasing in certain London boroughs of which the purchase price can be up to £450,000.
When the first time buyer is in a position to purchase a property, they would instruct a conveyancer to act on their behalf as a normal purchase would be instructed. The conveyancer would advise the buyer to disclose that they are being assisted by a help to buy ISA as soon as they instruct us. This is so they can advise the client to close the account as soon as possible as this can take the bank a few weeks to close.
The bank will then provide the client with a closing down statement, the conveyancer acting on the client’s behalf will require a copy of the closing down account and the conveyancer will provide their client with a declaration form that they are required to sign in order for the conveyancer to request the bonus. The declaration is confirmation from the buyer to the government that they are eligible for the bonus.
Once the purchase is ready to be set for completion and the conveyancer has both the declaration and the closing statement from the client they can request the bonus funds from the government portal for the day of completion. The bonus funds cannot be used towards the deposit for the exchange of contracts but shall be used towards completion of the purchase.
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