Best Help to Buy Isa rates 2019 – where to save your cash before November 30 deadline – The Sun

FIRST-time buyers can get up to £3,000 free cash with a Help to Buy Isa, but the deadline to open one is on November 30.

The government scheme rewards savers with a 25 per cent bonus to help them get on the property ladder.

But ministers have decided to pull the scheme in favour of the Lifetime Isa, which also gives buyers free government cash on savings worth up to 25 per cent.

So if you haven't opened a Help to Buy Isa by December 1 this year, you'll miss out on the bonus.

If you decide to open an account, you'll need to claim your bonus by December 2030.

Here's everything you need to know about Help to Buy Isa scheme and the best rates currently on the market.

What is a Help to Buy Isa?

An Isa is a tax-free savings account meaning that you can keep more of what you earn in interest on your cash.

A Help to Buy Isa is one that's backed by the government that will top up your savings to help you buy your first home.

The government will boost your savings by 25 per cent up to £3,000.

So for example, for every £200 you save the government will top it up by £50.

You can also earn interest on top of whatever you save. The rates are set by the bank who you've taken an account with and vary depending on the lender.

What help is out there for first-time buyers?

GETTING on the property ladder can feel like a daunting task but there are schemes out there to help first-time buyers have their own home.

Help to Buy Isa – It's a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move.

Help to Buy equity loan – The Government will lend you up to 20 per cent of the home's value – or 40 per cent in London – after you've put down a five per cent deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.

Lifetime Isa – This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25 per cent on top.

Shared ownership – Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25 to 75 per cent of the property but you're restricted to specific ones.

"First dibs" in London – London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.

Starter Home Initiative – A Government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the Starter Homes website.

Are there any downsides to a Help to Buy Isa?

You can open an account with a maximum of £1,200 but after that you're limited to saving £200 a month into it.

If you want to save more than that in one month then you'll need to consider opening another account to maximise your saving.

But you're only allowed to save into one Isa account in a year so you'll be taxed on the interest you earn in another type of account.

The minimum bonus is £400 meaning that you'll need to save at least £1,600 in your Help to Buy Isa before claiming the top-up.

Another downside is that you'll only qualify for the top-up on a property with a purchase price of up to £250,000, or £450,000 in London.

The money comes through when you complete on the purchase of the property.

It never actually reaches your account but instead goes straight to your solicitors and is tied up in the purchase transaction.

It must be used towards your deposit or to cover the legal fees, such as solicitor's charges or stamp duty.

If you don't want to use the money for the top-up in the end, you won't face a penalty for withdrawing cash early.

Best Help to Buy Isa rates 2019

Help to Buy Isas are offered by many different high street banks and building societies – and they can be opened with just £1.

Although they all offer the same government top-up, the rates will vary so we've made a round-up of the best ones below.

These are the top Help to Buy Isas open to everyone but you may find some building societies pay higher rates to locals.

  • Barclays – Apply Here

Rate: 2.58 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,231

  • Buckinghamshire Building Society – Apply Here

Rate: 2.50 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,230

  • Nationwide Building Society – Apply Here

Rate: 2.50 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,230

  • NatWest – Apply Here

Rate: 2.50 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,230

  • Virgin Money – Apply Here

Rate: 2.50 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,230

  • Ulster Bank – Apply Here

Rate: 2.50 per cent

Balance after 12 months, based on an initial £1,200 deposit: £1,230

Last month, Martin Lewis warned first-time buyers to open a Help to Buy Isa quick or risk losing out on thousands.

If you're looking for the best savings accounts, then check out our round-up here.

Alternatively, if you're considering an Isa – these are your best options.

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