Help to Buy ISA

[Misscf81]

Hi, my partner and I are in the process of buying a house and we are now at the point whereby we need to close our ISAs down with our bank as we are using this for the majority of our deposit.

Has anyone got experience of how this works as I have a feeling this is going to slow the whole process down. I am told we need to close our ISAs down with our bank and they they will provide us with a notice that we give our solicitors. This all seems straight forward however, our solicitor is insisting we have to use the 25% bonus as part of the deposit, even though I have read this could come after - does this potentially slow things down? I would rather just use the money we have saved, and then top up with our own funds to make up the rest of our deposit, and then the 25% bonus could come at a later date and we can use that for something else. I am just worried that in order to claim the 25% from the Government - it is going to take up too much time.

Thanks

You only receive the money at completion so I don't believe it can be used as part of the deposit.

I might be wrong but this is what I was told when I was looking to buy a house (still haven't hence why I may be wrong!)

You definitely need to get the money before completion
Can't be after
Get the account closed ASAP and pass closing confirmation to solicitor
In normal circumstances it is quite quick but probably will take longer in present circumstances

@Misscf81
Talk to the bank and keep talking until you explicitly understand the process including timescales.
Do not make assumptions and trust no one, it’s in your interest to put the effort into controlling the process as far as possible.

If you don’t have the information how can you make good decisions?

When I was researching if I should open a Help to Buy ISA or the newer Lifetime ISA (which also offers a 25% bonus for first time buyers), it was the confusion with when the 25% bonus was paid that put me off the Help to Buy. The terms and conditions in the government guidance say the 25% bonus can not be used as part of the deposit, however, as saving for a deposit is what the majority of first time buyers need help with then this was recognised as a major flaw, and most people didn't realise they couldn't use it as part of their deposit until too late. From what I read, a lot of good solicitors were able to work around it and obtain the bonus for the deposit, often by working with the vendors patience. It definitely is not the case that you have to use the bonus for the deposit, but the application for the bonus does need to go in when you withdraw.

However with the Lifetime ISA the 25% bonus can only be used for the deposit, maybe the solicitor is confused with the two different types of account?