Help to buy ISA - confused

[Tangoice]

Hi everyone...

I was wondering if anyone can help me. I have recently had an offer accepted on a property and I will be putting down a 5% deposit. My deposit is in two different bank accounts, one of which is a help to buy ISA with hsbc.

Solicitor has said she will let me know when to close down the account and they will then send me documentation confirming how much I'll receive with the government bonus. I've tried to work it out and I think it will roughly be between £500-600.

My question is - If the required deposit is 5K and I only have 4.5 saved up, can I use the government bonus to top it up? I'm assuming that's how it works? I read an article online that said I won't receive the government bonus until after the sale goes through, so now I'm confused

That’s true, the government changed the rules to stop fraud. The amount will usually be deducted from the legal fees after completion.

Yes you get the bonus after completion. So it's difficult to use for your deposit.

I used my bonus as a bit of extra cash to spend on the houses

Absolute nightmare! I never knew this. My fault for not checking properly. Thank you everyone

I thought the bonus couldn't be used towards paying the solicitors fees etc? I thought it had to be specifically used for the deposit. I'm a first time buyer and I was told the rules are different

The solicitor claims it at completion and it's used as part of the money to buy the actual property.

@QueenStromba I'm getting so confused here, sorry (maybe I'm just stupid). I'm only required to put down 5% so If I pay that during the exchange, what would the bonus actually be used for? I understand you're saying it's for the property, but why if I've already paid my deposit?

Because that's the rules.

@QueenStromba okay thanks. So effectively I'm paying more in a sense is that right?

You need to talk to your solicitor if you need to have the equivalent of the bonus leftover as cash at the end. It may or may not be possible depending on your personal circumstances as legally the bonus needs to be used for the house purchase. The solicitor might be able to take the equivalent amount of money out of the mortgage or the exchange deposit.

Okay thank you. I will give the solicitor a ring on Monday and see what they say. Thanks again