Help to Buy: ISA - frequently asked questions
Who is eligible to open an account?
To be eligible for our Help to Buy: ISA you must;
- be aged 16 or over;
- have a valid national Insurance number;
- be a UK resident for tax purposes;
- be a first-time buyer purchasing a UK property;
- currently live within a 25 mile radius of Stockport
A first-time buyer is someone that has never held any interest in a residential property anywhere in the world.
You will be able to open a Help to Buy: ISA until 30 November 2019. After that date they won’t be available to new savers anymore – but if you opened your Help to Buy: ISA before then you will be able to keep saving into your account until 30 November 2029, when accounts will close to additional contributions. You must claim your bonus by 1 December 2030.
You must be over 18 to be considered for a mortgage and you are not restricted to a Vernon Building Society mortgage when you buy your first home. Any mortgage application you make with any lender will be subject to underwriting criteria.
How much can I save?
The minimum investment and account balance is £1. In the first calendar month you can pay a maximum of £1,200 into the account. You can deposit up to £200 per month thereafter.
You can make any number of payments into the account during any given month provided that the £200 monthly limit is not exceeded. Once the amount deposited in any month reaches the maximum investment limit no further deposits are allowed until the following month, regardless of any withdrawals made. If any amount you pay in would exceed the maximum monthly deposit or your annual ISA allowance, the whole amount of that payment will be returned to you.
Late Receipt of funds
In the event that the monthly subscription limit is breached due to a late receipt of funds, especially in cases where the payment date nears the end of the month, we may permit the deposit of the funds if evidence can be provided of the actual date the payment was instructed.
How do I claim the government bonus?
The Government bonus will be available to first time buyers purchasing UK properties of up to £250,000 (£450,000 in London). The minimum bonus is £400, which means that you will not be eligible if the closing balance is less than £1,600. The maximum bonus is £3,000, which means that any part of the closing balance which exceeds £12,000 will not be included when calculating the amount of the bonus.
If you want to take advantage of the government bonus you should request a full closure of your Help to Buy: ISA account 30 days before you expect to complete your property purchase. We will issue you with a closing document within 7 days which an eligible conveyancer will use to claim the bonus on your behalf when you buy your home. To qualify for the Government bonus you must claim on or before 1st December 2030. Any amounts you withdraw before closure will not form part of the bonus calculation. The government bonus is paid to the conveyancer before completion when it is certain that the purchase will go ahead. It cannot be used for the deposit at exchange of contracts.
You should contact your conveyancer for assistance if it is not possible to request closure 30 days before the expected completion date. If the government bonus is needed urgently, there is a faster bonus application process conveyancers can follow.
How does the Vernon bonus work?
The maximum bonus payable is £1,000. For joint mortgage applicants only one Vernon bonus will be awarded. You must have a balance of at least £1,600 and have held a Help to Buy: ISA account with us for a minimum of 6 months to qualify for the Vernon bonus. This bonus will be paid after completion and cannot therefore be used for the deposit on the house.
What happens if my house purchase falls through?
If your conveyancer claims a Help to Buy: ISA bonus but your purchase does not go ahead, we will allow you to pay your Help to Buy: ISA savings into a new Vernon Help to Buy: ISA. To do this we will need a Purchase Failure Notification from your conveyancer and closing documents previously issued by the Society. Alternatively, you may approach a different provider to open a new Help to Buy: ISA or any other ISA. You must do either within 12 months of closing your Help to Buy: ISA. If you open a new account with us, your new account may not have the same account number or account conditions but we will provide you with this information at the relevant time.
What are the risks?
As the rate of interest paid on the account is variable this means that the interest rate could go down as well as up. The bonus paid under the Help to Buy: ISA scheme is paid by the Government. Subject to the scheme rules, the Government can vary or withdraw the scheme at any time. The Government can also change the taxation treatment of ISAs at any time without prior notice.
Help to Buy: ISAs can be transferred between providers. You may only have one Help to Buy: ISA at any time, which must be in your own name, therefore to transfer a Help to Buy: ISA from another provider you must transfer your balance in full.
You can transfer your Help to Buy: ISA to another provider at any time. To do this you need to contact your new provider. If you transfer to another Help to Buy: ISA then your eligibility for the Government bonus is preserved. If you transfer into a non Help to Buy: ISA we will issue you with a closing document. Your eligibility for a Government bonus will be lost if you do not use the funds detailed on the closing document for your house purchase deposit within a year of the closure date.
Please read the Government’s Help to Buy: ISA Scheme rules in conjunction with this document, as these are part of the contract for your Vernon Help to Buy: ISA. These explain in detail how the scheme works, and contain some restrictions and key definitions (including the definitions of Eligible Customer, Eligible Conveyancer and First Time Buyer). You can obtain a copy at helptobuy.gov.uk/isa, in branch, or by contacting 0161 429 6262.
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