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.