Nationwide sees first Help to Buy ISA mortgage completions

5 February 2016

  • First account holders to access Help to Buy ISA Government bonus
  • Savers with Nationwide Help to Buy ISA can access discounted 5% deposit mortgages
  • Nationwide cashbacks available of up to £1,750 on top of Help to Buy ISA bonus.

Nationwide Building Society has marked the first mortgage completion by its Help to Buy ISA savers, claiming the minimum £400 Government bonus following the scheme’s launch on 1 December 2015.

Of those customers eligible to claim after opening their accounts on 1 December, more than 40 Nationwide Help to Buy ISA savers have already closed their balance in order to claim their Government bonus, with one applicant from Northampton, completing yesterday, Friday 5 February, and another four joint applicants, from Glasgow and Derby respectively, due to complete within the next week.

Of those, one couple who have made a Nationwide Save to Buy mortgage application have been able to access the maximum total of £1,750 available to the Society’s Help to Buy ISA customers in cashbacks and bonus. This is made up of a £500 cashback available to all Nationwide first time buyers, a further £250 cashback for all Nationwide Flex* main current account holders and a £1,000 cashback available to existing savers through Nationwide’s Save to Buy scheme when taking a Save to Buy mortgage. As joint first time buyer mortgage applicants, both customers are also claiming £400 each in Help to Buy ISA bonus payments, a total of £800, making a grand total of £2,550 in cashbacks and bonuses.

In the first month of Nationwide Help to Buy account openings, the largest percentage and more than half of the first time buyer applicants (55%) were in the 25-35 age bracket, with a third (34%) aged 18-25. Four in five maximised the amount they could contribute to the account in the first month only, depositing £1k-£1.2k, with an average overall balance of £981. So far, a slightly higher number opened those accounts online (55%) than in branch (45%)

The top five areas for Nationwide Help to Buy ISA account openings have been Birmingham, Northampton, Reading, South West London and Bristol. In terms of regional variations, it has proved most popular in the South East (22% of account openings) and Greater London (18%).

Andrew Baddeley-Chappell, Nationwide’s Head of Mortgages and Savings Policy, said: “These savvy borrowers have been quick off the mark in realising the benefits available under the scheme. Of course, those who save more and for longer can get an even larger bonus, but this first tranche of eager first time buyers shows just how quickly the benefits can flow through the scheme. Adding in the potential cashback from Nationwide demonstrates the significant support available to those looking to get a first foot on the housing ladder.”

It shows that there is a clear reason for first time buyers always to open a Help to Buy ISA, irrespective of when they intend to buy, and especially if they can save the maximum monthly amounts to increase their government bonus.”

Nationwide Help to Buy ISA customers are eligible for its Save to Buy discounted mortgage range, with rates 0.20% lower than the main core range on mortgages with a 5 to 14.99% deposit. With a savings rate of 2% AER. Nationwide customers 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 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.

Nationwide 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 and over, as well as the Government’s Help to Buy ISA bonus. 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. Existing Save to Buy savers 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.

Notes to Editors

Help to Buy ISA

  • Help to Buy ISA was 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.

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