Osborne reveals Help to Buy ISA rules

When first time buyers close their account, they will receive a closing letter from their ISA manager which they then need to give to their solicitor.

Using the letter, the solicitor will apply online for the government bonus, and will then complete the purchase of the home using the full bonus amount.

First time buyers need to apply for their bonus within 12 months of closing their account, but if a home purchase doesn’t go through after a solicitor or conveyancer has received the government bonus, the account can be re-opened with the full amount.

George Osborne said:

"We’re just one month away from the launch of the Help to Buy: ISA which will provide extra help for working people who want to buy their own home."

Starting on 1 December, first time buyers saving for a deposit will be able to save up to £200 a month in a dedicated ISA that the government will top up by 25%, up to a maximum of £3,000.

First-time buyers eager to make the most of the scheme can also open their account with a one-off lump sum of up to £1,000 in addition to the monthly maximum. Couples buying together will be able to combine their bonuses, meaning a potential boost of up to £6,000 towards a deposit for a first home.

Barclays, Lloyds Banking Group, Nationwide, NatWest, Santander, and Virgin Money will be offering Help to Buy: ISAs from 1 December.