What was a Lifetime ISA?
The government’s Lifetime ISA is a government scheme introduced back in 2017. A Lifetime ISA helped first time buyers in Birmingham save up enough savings for their first property.
How did Lifetime ISA’s work?
For short, the ISA (Independent Savings Account) is a savings account where your money grows tax-free. Although there is no minimum of how much you can save each month, you can only put in £4,000 a year into this account.
As a bonus, the government top up your total annual savings by an extra 25%, so if you hit the £4,000 mark, you will receive an extra £1,000 tax-free, making your total yearly savings to £5,000.
Worry not if you don’t hit the maximum. Even if you save £720 per year (£60 a month), you will receive an additional £180 tax-free from the government.
You should know that you cannot withdraw it once the money is inside the savings account without paying a fee.
We recommend looking at the Lifetime ISA when you need that extra support to afford your deposit or planning to buy your first home within the next couple of years. Having that spare time, you can keep adding more money to strengthen your ISA until you are ready to withdraw the funds for your first property. You can find more information on GOV UK- Lifetime ISA.
How were you able to qualify for a Lifetime ISA?
- You can only use this scheme on your first home purchase.
- The maximum you can put into the account is £4,000 a year.
- The property that you are buying must cost £450,000 or less.
- You have to be under the scheme for at least a year before you can make a purchase.
- The age bracket for this scheme is aged 18 – 40.
If you were lucky enough to open a Lifetime ISA savings account and have saved enough for a housing deposit, feel free to get in touch with your mortgage broker in Birmingham, and let’s begin your mortgage journey.
Mortgage Advice in Birmingham
If you have a Lifetime ISA opened or curious about otherhome buying schemes in Birmingham that could match your situation. Now could be the perfect time to contact an expert mortgage advisor in Birmingham.
Our mortgage advisors don’t just specialise in Lifetime ISA’s. They have experience with other mortgage types, and we aim to help customers get onto the property ladder.
Date Last Edited: February 19, 2024
