Home Front logoQ. Can you tell me more about the Governments new Help to Buy ISA that recently announced in the budget? Apparently they will give you a bonus on your savings of 25%? Sounds too good to be true, can you explain?

A. The government is committed to supporting people who aspire to become homeowners. Recognising that increased deposit requirements had left many hardworking households unable to get onto the Property ladder in 2013 they introduced the Help to Buy Scheme which has been a great success and now a new scheme – The Help to Buy ISA. In many ways, the Help-to-Buy ISA will be like any other ISA as you can earn tax-free interest on any money you save there. The big difference with this new scheme is that for every £1 you save the government will give you 25p. It’ll match that up to a maximum of £200 each month and up to a total of £12,000. So if you are able to save £12,000 and you’ll actually have £15,000 to play with. Help to Buy ISAs should be available from autumn 2015 (ministers still need to finalise the details with the industry) and will stay open to first-time buyers for four years. The good news is once you have one there are no time restrictions on how quickly you have to save and no time limit on when you can use the government’s bonus. Help to Buy ISAs are only for people buying their first home to live in. If you’re buying a home on your own you can use one Help to Buy ISA. Even better news is if you’re buying it with someone else you can both get one and if three of you are buying a house together you can all still get one each and use all three Help to Buy ISAs to help get you started. And so on. The Help to Buy ISAs won’t be available until later this year, but you’ll be able to open one with (up to) a £1,000 deposit. That way ministers say first-time buyers can start saving now and still won’t lose out if they’ve got £1,000 together by then. The Help to Buy ISA will only be available on homes worth up to £250,000 (or £450,000 in London). Opening a Help to Buy ISA will, in most ways, be identical to opening a regular ISA under the existing cash ISA rules. A bank or building society will apply their normal account opening processes which include a minimum age of 16 years old and asking for a National Insurance Number. However, the ISA is only available for first time buyers; and each first time buyer can only open one Help to Buy ISA during the lifetime of the scheme.