Can you do better than Halifaxs 4pc Help to Buy Isa?


Prospective first-time home buyers can open a Help to Buy Isa, with interest rates of up to 4% available. We take a look at the details of the scheme and round up the best deals on offer so far.

The Help to Buy Isa is a government scheme designed to help would-be first-time buyers get onto the property ladder. 
If you’re saving for your first home, you can deposit up to £200 a month in a Help to Buy Isa (plus an additional initial deposit of £1,000), with the government topping up these savings by 25%, up to a maximum bonus of £3,000. 
You can use Help to Buy Isa savings to buy a home worth up to £250,000, or £450,000 in London. If you’re buying with someone else, you can open separate accounts and jointly earn a bonus of up to £6,000. 

                                                                      Best Help to Buy Isa deals so far

Many of the leading banks and building societies have signed up to offer a Help to Buy Isa. There’s a good range of options for savers, with different interest rates, upselling deals and cashback offers on the table. We’ll be updating this list with the best deals as they’re announced.

Halifax Help to Buy Isa – 4% interest rate – best interest rate announced so far

With the highest interest rate announced so far, Halifax says savers depositing the maximum amount over five years can turn £13,000 of contributions into over £17,500 when buying a house (including the government bonus). 

Virgin Money – 3% interest rate

Barclays Help to Buy Isa – 2.25% interest rate: launches 17 December. Customers can only open an account in branch or by telephone.

Aldermore Help to Buy Isa – 2% interest rate: customers who already have an Aldermore cash Isa can pay in to a Help to Buy Isa too. 

HSBC Help to Buy Isa – 2% interest rate

Nationwide Help to Buy Isa – 2% interest rate: customers can pay into another Nationwide cash Isa in the same tax year. Cashback of up to £1,750 on offer for customers who take out a mortgage with Nationwide. 

Natwest Help to Buy Isa – 2% interest rate

Santander Help to Buy Isa – 2% or 1.5% interest rate: Santander 123 World and Select customers will receive an interest rate of 2% while all other customers will get 1.5%.

Ulster Bank Help to Buy Isa – 2% interest rate

Lloyds Bank Help to Buy Isa – 2% interest rate

Bank of Scotland Help to Buy Isa – 2% interest rate

Newcastle Building Society Help to Buy Isa – 1.51% interest rate: (0.51% in any month you make a withdrawal or don’t pay anything in). You can also open separate cash Isa alongside the Help to Buy Isa.

Clydesdale Bank Help to Buy Isa – 0.7% interest rate

Yorkshire Bank Help to Buy Isa – 0.7% interest rate

Principality Building Society, Royal Bank of Scotland and First Direct won’t be launching products this month, but are considering doing so in the future.

How do I get a Help to Buy Isa?

First-time home buyers aged 16 or over can open a Help to Buy Isa. You will need to sign two declarations, one when you open the account and another when you apply for the bonus, to confirm that you are a first-time buyer. 

You can open the account with an initial deposit of up to £1,200 in the first month. This includes a £1,000 one-off contribution, and the usual monthly maximum payment of £200. 

If you don’t want to contribute the maximum amount each month, that’s fine. The minimum bonus payment from the government is £400, so you will need to save at least £1,600 in your Isa before you can earn this. 

The bonus is paid when you purchase a property, and the Help to Buy Isa can be used alongside other schemes such as Help to Buy equity loans and shared ownership. 

A word of warning, though: if you’ve already paid in to a cash Isa within the 2015/16 tax year (which started on 6 April 2015), there’s a good chance you won’t be able to open a Help to Buy Isa until April 2016, as you can only pay in to one cash Isa each tax year. So far, only Nationwide and Aldermore are letting existing Isa customers also contribute to a Help to Buy Isa in the same tax year.

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