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Help to buy for first time buyers saving for a mortgage deposit

Saving up for a deposit for a mortgage can take years and requires a lot of commitment so it is important to choose the right products to help save you money.  here we outline  several options you should consider.

Help to buy

Help to buy

Help to Buy ISA

The Chancellor announced in the March 2015 budget, the introduction of Help to Buy ISAs available from Autumn 2015.  These are aimed to help people who are saving up for a mortgage to buy their first home.   For every £200 saved into the account, the government will pay a 25% bonus of £50 up to a maximum of £3000.  This bonus is then used for the purchase of a home up to the value of £250,000 or £450,000 in London.  It is possible for two people who are saving for a mortgage together to both receive a bonus as the accounts are per person rather than per household.  Any interest you earn from your help to buy ISA will be tax free, however, you must make sure that you don’t pay into another cash ISA in the tax same year.

Savings Account

Savings accounts often pay good rates of interest so can be a good way of saving for a deposit for a mortgage.  There are often restrictions, however, such as a limit to how many withdrawals you can make or you may receive less interest if you miss a month of savings.   

If you have a small lump sum built up but it is going to take you another few years to save up the rest of the deposit for your mortgage, you could lock this away in a fixed rate savings account.  You could then use a cash ISA or a regular savings account for the rest of your savings.  Here at Assured Wealth we have an independent adviser who can assess the market and suggest which savings account will be most suitable for your needs and requirements.  


When it comes to investing your savings you need to carefully consider your capacity to loss.  This mean can you afford to lose what you have saved.  The answer will probably be NO.  Think carefully about equities and mutual funds as there can be market fluctuations with these types of investments, which mean that you may lose capital if the markets fall.

To find out about how equity investments can work for your mortgage savings, speak to one of our IFA’s today.


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