Nationwide offers extra benefits on Help to Buy ISA

30 November 2015

  • Competitive savings rate of 2% AER and access to discounted 5% deposit mortgages
  • Nationwide cashbacks available of up to £1,750 as well as Help to Buy ISA bonus
  • Only large provider offering more than one cash ISA product in Nationwide wrapper

From Tuesday 1 December, Nationwide Building Society is launching its Help to Buy ISA, with a 2% rate on savings and a cashback of up to £1,750 for first time buyers accessing its Save to Buy mortgage range.

These benefits are in addition to a Government Help to Buy bonus of up to £3,000 per customer. It means that joint first time buyer mortgage applicants who have each saved into a Nationwide Help to Buy ISA can therefore potentially access a total bonus and cashback benefit of up to £7,750 towards their first home.

The Help to Buy ISA is available only to first time buyers. Savers can deposit up to £1,200 in the month they open the account and a further £200 in each subsequent month. For every £200 maintained in a Help to Buy ISA account, £50 will be paid by the Government as a bonus at the time of purchasing a first home. The minimum Help to Buy deposit bonus is £400 and the maximum £3,000.

Details of Nationwide’s Help to Buy ISA structure is as follows:

Savings

  • The savings rate for the Help to Buy ISA is 2% AER
  • Customer can contribute up to the limit of £200 a month into the Nationwide Help to Buy ISA product and invest into another Nationwide cash ISA product in the same tax year.
  • This is because, currently unique amongst the major savings providers, Nationwide will enable both new and existing customers wanting to open a Help to Buy ISA with the Society to split their ISA savings across more than one cash ISA product, all within the Nationwide ISA wrapper.
  • Help to Buy ISA savers with Nationwide will therefore be able to benefit from spreading their ISA balance across more than one ISA product with the Society, saving up to the full annual tax year ISA limit of £15,240.

Mortgages

  • Nationwide’s Help to Buy ISA customers will be offered access to the Society’s Save to Buy mortgage range, available for those with a 5 to 14.99 per cent deposit.
  • Save to Buy mortgages offer additional cashback to customers saving through Nationwide’s Help to Buy ISA product - £500 for savings of £0-4,999 and £1,000 on savings of £5,000, as well as the Government’s Help to Buy ISA bonus.
  • All first time buyers with Nationwide will also qualify for a £500 cashback on all mortgage deals.
  • Customers with a main Nationwide current account are currently eligible for a £250 Flexclusive cashback on all mortgage deals
  • This means the total cashbacks currently available from Nationwide to its Help to Buy ISA customers completing on a Nationwide Save to Buy mortgage can be up to £1,750
  • Customers who take a Save to Buy mortgage above 90 per cent loan to value (LTV) also receive a 0.20% discount on the equivalent main customer rate.
  • All Nationwide mortgage customers can now benefit from fee-free standard valuations.

Existing Nationwide Save to Buy Customers

  • Nationwide’s current first time buyer Save to Buy customers can save into the Help to Buy ISA from the start – and benefit from both schemes if eligible.
  • Customers who are first time buyers can combine their existing Save to Buy savings balance with a new Help to Buy ISA and earn a cashback of up to £1,750 on the total balance when they complete on a Save to Buy mortgage.
  • Existing Save to Buy customers will be able to make withdrawals from their account to fund a new Nationwide Help to Buy ISA.

Chris Rhodes, Nationwide’s Retail Director, said: “Nationwide has a long history of supporting first time buyers and expects that the new Help to Buy ISA will enable even more customers take their first steps on the housing ladder. The Society already supports other Help to Buy schemes and offers around of a third of all lending for the Help to Buy Equity Loan scheme.

“Through our existing Save to Buy initiative, we have already provided more than £1 billion in mortgage lending and rewarded almost 10,000 customers who have committed to saving towards their deposit. Now we will be able to provide additional incentives for customers who save regularly and plan early to buy a home of their own.”

With its existing Save to Buy initiative, which began in May 2011, Nationwide has long championed the benefits of saving towards a house deposit, with more than 40,000 customers currently with an open Save to Buy savings accounts.

Nationwide will be contacting all existing Save to Buy customers to notify them that they could be eligible to open a Help to Buy ISA alongside their Save to Buy savings account. The Save to Buy savings accounts and ISA will be removed from sale to new customers.

Notes to Editors

Help to Buy ISA

  • Help to Buy ISA will be launched on 1 December. For every £200 saved into a Help to Buy ISA account, £50 is paid by the Government as a mortgage bonus
  • It is available to first time buyers only. Each first time buyer may open their own account and apply for their own mortgage bonus.
  • First time buyers who save into a Help to Buy ISA will be eligible for a bonus of up to £3,000 (on balances up to £12,000 including interest) each when buying their first home. Savers must have a minimum balance of £1,600 to qualify for the bonus. There will be a maximum savings limit for customers of £1,200 deposit in the first month of subscription, plus £200 a month thereafter into the Help to Buy ISA account.
  • The minimum Help to Buy ISA bonus of £400 can be claimed on February 1 2016 if saving the maximum amount from 1 December
  • Individuals have four years to open the account and the bonus can be claimed up until 2030.
  • Savers can only ever have one Help to Buy: ISA open at any one time.
  • A Nationwide Help to Buy ISA can be opened with new savings, from existing Nationwide ISA savings or from the transfer in of ISA savings from another provider (up to £1,200 in line with scheme rules).

Save to Buy

  • Save to Buy is Nationwide’s existing initiative to help those saving for a deposit for their first home, with customers able to access a Nationwide mortgage of between 85.01% and 95% LTV, and receive a cashback of up to £1000 if eligible.
  • From 1st December existing Save to Buy savers can apply for a Save to Buy mortgage, once when they are in at least the third calendar month of holding the account. Nationwide Help to Buy ISA customers must also be in at least the third calendar month of holding their account before being able to apply for a Save to Buy mortgage.
  • The Nationwide Save to Buy cashback and the Help to Buy ISA Government mortgage bonus are accessed differently and the payment is provided in different ways. Nationwide’s Save to Buy cashbacks are available to Nationwide Help to Buy ISA savers on completion of a Nationwide Save to Buy mortgage. To claim the Help to Buy ISA bonus, the Help to Buy ISA account must be closed and the closure statement provided to the conveyancer. The conveyancer will claim the bonus from the Government and use the bonus towards the cost of the house purchase.
  • Most first time buyers with a small deposit could be eligible for both a Save to Buy mortgage cashback and a Help to Buy ISA bonus, but not everyone will always be eligible for both.
  • Save to Buy mortgages will be available for those with a Nationwide Help to Buy ISA from 85.01 – 95 per cent LTV. A 0.2 per cent discount is available on Save to Buy mortgages of 90.01 – 95 per cent LTV. They are also available to those with Save to Buy savings.
  • First time buyers who complete on a Nationwide mortgage are eligible for a £500 cashback

*Flexclusive mortgages are available to Nationwide main current account holders who:

  1. Hold a FlexOne account and be aged 18 or over, or hold a FlexAccount with a Visa debit card (not cash card or cash card+) and have:
    1. Been paying in £750+ a month for the last 3 months (excluding internal transfers);
      or
    2. Completed an account switch to us (from a non-Nationwide account) using our Current Account Switch Team in the last 4 months; or
  2. Hold a FlexDirect or FlexPlus account.

About Nationwide

Nationwide is the world's largest building society as well as one of the largest savings providers and a top-three provider of mortgages in the UK. It is also a major provider of current accounts, credit cards, ISAs and personal loans. Nationwide has around 15 million customers.

Customers can manage their finances in a branch, via the mobile app, on the telephone, internet and post. The Society has around 18,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.

Please note: If you are a customer looking for information on our products and services, please visit the main website.