'How do I get my Assistance to Purchase Isa reward if I buy at auction?'

 

I am a first time buyer, with a Help to Buy Isa account, planning to buy a property at auction.As I would have already had to transfer the 10pc to the supplier on the day of the auction and the remaining balance within 28 days, how would I get the 25pc Help to Buy Isa reward?

G. Craig, e-mail

Help to Buy Isas were released last December as a way to help very first time buyers get on the property ladder.

They are an appealing way to save for your very first home, thanks to the interest rates on offer and the 25pc bonus offer you obtain from the Government.

To be qualified for the perk, you must have a mortgage on the property. If you're a money purchaser you can still save in a Help to Buy Isa, however you will not get the added 25pc.

Picking up the Help to Buy Isa perk works in much in the exact same method when buying an auction property as it does when buying a home on the marketplace. Your solicitor has to request it prior to you complete.

Samantha Blackburn, head of house at solicitor firm Slater and Gordon, said it is important to obtain a home mortgage arranged in concept before participating in the auction.

You normally have simply 28 days after the sale to get everything finalized - sometimes even less. On the day of the sale, you will need to pay the 10pc deposit plus charges, which are normally between 200 and 300, according to the Home Owners Alliance.

To claim your 25pc reward, you first need to close your Help to Buy Isa and have the cash moved to your solicitor or another account.

Your bank will compose to you, confirming the closure of the account and your lawyer will use this, together with other files to request the benefit on your behalf.

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As Help to Buy Isas are so new, Ms Blackburn stated it is difficult to say precisely how long the procedure takes. HM Treasury recommends five days prior to conclusion suffices time to apply for your 25pc, but she currently allows two weeks.

Your lawyer or conveyancer is permitted to charge you approximately 50 plus VAT for their part in the reward application process.

Ms. Blackburn stated using your Help to Buy Isa bonus for an auction property is not impossible, you just have to be extremely conscious of your deadline and the demands you will be placing on your solicitor.

She stated: There are threats included with buying a property at auction. It can be done but you have to make sure you provide yourself enough time.

Make sure you’ve got a home mortgage in concept in place before buying the property and get your solicitor to go over the legal pack to establish if there are any problems which might hold things up.

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If not correctly thought about ahead of time, these aspects can trigger some serious headaches when taking over a tenanted property. The last thing you want is to inherit a deposit disagreement, or a slew of pricey repairs, stated Savage, so you do need to guarantee that your rights in these matters are protected as far as possible in the sales contract you sign.

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