18th March 2015
The Government is launching a new Help to Buy ISA for first time buyers with the state contributing £50 for every £200 saved towards a deposit on a first home.
The bonus will be calculated and paid when the borrower buys their first home with the Government saying it amounts to a 25% tax free bonus up to a maximum of £3,000. The Isa will be available on homes priced up to £450,000 in London and £250,000 outside London.
The Help to Buy Isa will have a maximum initial deposit of £1,000 with a maximum monthly deposit set at £200. The Government will contribute a maximum of £3,000 on £12,000 of savings.
The scheme is only open to first-time buyers and each buyer can only have one Help to Buy: Isa during the lifetime of the scheme.
Savers will be able to open a Help to Buy: Isa for a four-year period after the date of the scheme formally opens. However, when an account has been opened there is no limit on how long a person can save into the Isa. The government says there will be no time limit on when the bonus can be claimed.
Chancellor George Osborne, in his Budget speech: “It is as simple as this: we will work hand in hand to help you buy your first home. This is a Budget that works for you.”