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Progressive Building Society has warned that time is running out for prospective first-time buyers to open a Help to Buy: ISA. This type of ISA (Individual Savings Account) entitles savers to receive an additional 25% bonus from the government towards their savings for the deposit for their first home. This means for every £200 saved the government contributes £50, from a minimum closing balance of £1,600 which will earn extra bonus of £400, up to a maximum bonus of £3,000 on savings of £12,000.
The Help to Buy: ISA, tailored to help first time buyers save a deposit for their first home, is only open until 30 November 2019 and won’t be available to new savers after this date. While the accounts, which are eligible for people aged 16 years old and over, must be opened before this deadline, the account terms and conditions of being able to save up to £200 per month will continue to apply after this date, and government bonuses will remain available, until 1st December 2030. This means that people don’t have to buy their first house in the near future to open an account but can plan for the medium to long term.
Since Help to Buy: ISAs were launched in 2015, more than 286,000 people in the UK have opened an account and availed of the government bonus, while the average age of first time buyers with a Help to Buy: ISA is 27, three years younger than the national median age of 30 (HM Treasury, 2019).
According to Declan Moore, Progressive Building Society Operations Director, first time buyers must act now to avoid missing out on this offering from the government, “The Help to Buy: ISA provides considerable financial support for the average first-time buyer in saving to get onto the housing ladder sooner than they might otherwise be able to.
“While the bonus must be used towards a deposit, our message is that you don’t have to be planning to buy your first house immediately in order to open an account. Furthermore, two people buying a house together can both open a Help to Buy: ISA, meaning they could receive double the bonus. There is no catch other than ensuring that each account’s closing balance is between £1,600 and £12,000 so we would urge first time buyers to take advantage while they still can.”
Declan added: “Saving for the deposit remains the biggest challenge for those hoping to secure a home of their own and the Help to Buy: ISA can go some way towards making this slightly easier for first time buyers. We are dedicated to supporting young people in saving for a house deposit and to help them achieve their dream of home ownership. We would therefore encourage potential first time buyers to open a Help to Buy: ISA as soon as they can to ensure they are eligible to claim their 25% government bonus when they come to buying their first home.”
Progressive Building Society is keen to ensure that as many first time buyers as possible have the opportunity to benefit from the government support before the initiative runs out, so is offering a £750 mortgage cashback to anyone who takes both a Help to Buy: ISA, and their first mortgage, with the Society. This offer is available per person rather than mortgage application, so anyone who is buying their first home with someone else, be it their partner or family member, could receive a total mortgage cashback of £1,500. Lending criteria, terms and conditions apply to any mortgage application with Progressive. Find out more about opening your Help to Buy: ISA.
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