Budget 2021: Mortgage guarantee to help buyers with 5% deposit

[Rids]

Back on topic, really interested in seeing what the mortgage offerings will be when they go live.

I'd been planning on having enough deposit / funds to cover stamp duty and moving towards the back end of 2022 but looks like I'll be able to bring that forward 18 months if the offerings are not punitive.

 

[HACO]

Back on topic, really interested in seeing what the mortgage offerings will be when they go live.

I'd been planning on having enough deposit / funds to cover stamp duty and moving towards the back end of 2022 but looks like I'll be able to bring that forward 18 months if the offerings are not punitive.

Probably 4.5% interest.

 

[Scam]

I see that Richy Rich has reinstated the Lifetime ISA withdrawal penalty. Not surprised as they are raking it in from the penalties

As usual, the government prioritises propping up the housing bubble rather than actually helping sensible savers. If your circumstances change through no fault of your own, or perhaps you decide to take the plunge and buy with a partner and can now afford over the £450k limit. Tough cheese! Pay over 6% penalty to access your own savings! It's literally daylight robbery. Scum.

I had already written to my MP about this and will be following up. As well as seeking next steps, perhaps to seek action to prove the government has been guilty of misselling such products much like the PPI fiasco.

 

[stuman]

Probably 4.5% interest.

would need to be 2.5% to make sense. 80% risk reduction, anything near to 4.5 would be taking advantage.

 

[Lethal`]

I had already written to my MP about this and will be following up. As well as seeking next steps, perhaps to seek action to prove the government has been guilty of misselling such products much like the PPI fiasco.

How is it mis-selling? It was pretty clear in LISA terms when it was first released that there is a penalty if you withdraw early.

 

[Frubeling]

Good timing with my having just opened a lifetime ISA

I see that Richy Rich has reinstated the Lifetime ISA withdrawal penalty. Not surprised as they are raking it in from the penalties

It's clearly stated when you open them that you lose the bonus should you withdraw for purposes outside of purchasing a home or retirement.

 

[Deleted User 298457]

I see that Richy Rich has reinstated the Lifetime ISA withdrawal penalty. Not surprised as they are raking it in from the penalties

As usual, the government prioritises propping up the housing bubble rather than actually helping sensible savers. If your circumstances change through no fault of your own, or perhaps you decide to take the plunge and buy with a partner and can now afford over the £450k limit. Tough cheese! Pay over 6% penalty to access your own savings! It's literally daylight robbery. Scum.

I had already written to my MP about this and will be following up. As well as seeking next steps, perhaps to seek action to prove the government has been guilty of misselling such products much like the PPI fiasco.

Did you not read the form when you signed up? It couldn't have been any simpler to understand. I used two LISAs to buy my place and it was a key consideration when finding a property.

Edit: and the 450k hard limit was such an easy negotiating technique for us buying a property listed at 525 lol.

 

[Surveyor]

Did you not read the form when you signed up? It couldn't have been any simpler to understand. I used two LISAs to buy my place and it was a key consideration when finding a property.

Edit: and the 450k hard limit was such an easy negotiating technique for us buying a property listed at 525 lol.

The property must have been significantly overpriced.

 

[Deleted User 298457]

The property must have been significantly over priced.

Yeah definitely. The identical one next door sold for 460k which seems more realistic (and was listed for 475k). So I guess you could say it helped us get the 10k off that next door paid.

Edit; Zoopla insists 528 proper random number generator.

 

[Scam]

How is it mis-selling? It was pretty clear in LISA terms when it was first released that there is a penalty if you withdraw early.

I opened it thinking I would be buying on my own (under 450k) but now my partner and I have decided to buy together (over 450k). So it's good for nothing.

Did you not read the form when you signed up? It couldn't have been any simpler to understand.

See above.

The 450k hard limit is ridiculous. You're either a first time buyer or you're not. It doesn't matter where you live, everything is relative. You have to ask yourself why the government is putting in arbitrary limits/penalties simply for saving money that I have already paid tax on once.

In addition, if they keep inflating house prices then everyone who opened a LISA in the South East will eventually get to the point that they can't buy anything under 450k, lol

 

[Deleted User 298457]

I opened it thinking I would be buying on my own (under 450k) but now my partner and I have decided to buy together (over 450k). So it's good for nothing.

See above.

The 450k hard limit is ridiculous. You're either a first time buyer or you're not. It doesn't matter where you live, everything is relative. You have to ask yourself why the government is putting in arbitrary limits/penalties simply for saving money that I have already paid tax on once.

In addition, if they keep inflating house prices then everyone who opened a LISA in the South East will eventually get to the point that they can't buy anything under 450k, lol

? Literally all stated upfront when you join the club for free hand outs...

 

[Surveyor]

I see that Richy Rich has reinstated the Lifetime ISA withdrawal penalty. Not surprised as they are raking it in from the penalties

As usual, the government prioritises propping up the housing bubble rather than actually helping sensible savers. If your circumstances change through no fault of your own, or perhaps you decide to take the plunge and buy with a partner and can now afford over the £450k limit. Tough cheese! Pay over 6% penalty to access your own savings! It's literally daylight robbery. Scum.

I had already written to my MP about this and will be following up. As well as seeking next steps, perhaps to seek action to prove the government has been guilty of misselling such products much like the PPI fiasco.

Withdraw the money before 6 April and the penalty is equivalent to losing the bonus the government gave you to help buy a property within the scheme rules.

 

[Scam]

? Literally all stated upfront when you join the club for free hand outs...

Stop trolling for once in your life You know the LISA is inherently flawed, literally every young person in more expensive markets will have the same issue. Open it as an 18yr old, by the time they come to use it they will probably want to buy with a partner.. prices will have risen and perhaps they're in an area where FTB properties are now >450k then not-only will they use the bonus, but they will lose more money than they put in. It's ridiculous for a saving product that is supposed to be there to help young people. What would you have them do at 18yrs old, look into a crystal ball to see if that 350k starter home might be 450k in 6 years? It's stupid.

And beyond my situation, what about those who need to access their savings because of COVID? Is your answer the same? Should they be penalised?

I'm not the only one talking about misselling, there's plenty of articles stating this may be investigated.

EDIT:

Withdraw the money before 6 April and the penalty is equivalent to losing the bonus the government gave you to buy a property within the scheme rules.

I know, I will be doing this. Doesn't stop me being angry about it.

 

[Deleted User 298457]

Stop trolling for once in your life You know the LISA is inherently flawed, literally every young person in more expensive markets will have the same issue. Open it as an 18yr old, by the time they come to use it they will probably want to buy with a partner.. prices will have risen and perhaps they're in an area where FTB properties are now >450k then not-only will they use the bonus, but they will lose more money than they put in. It's ridiculous for a saving product that is supposed to be there to help young people. What would you have them do at 18yrs old, look into a crystal ball to see if that 350k starter home might be 450k in 6 years? It's stupid.

And beyond my situation, what about those who need to access their savings because of COVID? Is your answer the same? Should they be penalised?

I'm not the only one talking about misselling, there's plenty of articles stating this may be investigated.

EDIT: I know, I will be doing this. Doesn't stop me being angry about it.

How is it trolling? You literally signed up to a scheme that outlines all of the limitations you are now moaning about. It is flawed if you live in the south but that is where H2B is potentially a more appropriate scheme (and has London weighting for the increased property value). If you aren't planning ahead for a change in circumstances then more fool you, especially so close to the limit. The government allows you to opt out but there is a cost of breaking the deal. If you don't break the deal though, you are quids in.

Also you are a bit shortsighted if you are paying in to it as a monthly savings account as most have pitifully low rates. I think I transferred my full allowance in for the year about 30 days before I needed it as the bonus is paid monthly up to the maximum value. For the exact reasons you have outlined I'm curious why you would have any more than a pound in there let alone transfer a monthly figure?

I got really lucky in that my house sale went through at 450k, and the LISA was specifically why we hit that figure otherwise it would have been more. But of my 45k deposit I think at least 5k from memory came from government hand outs (thnx tax payer) thanks to the LISA. I can see your point but I definitely can't empathise.

It is funny how "i'm alright jack" this forum is consistently. It wasn't long ago there was a load of people in HACO's thread saying that FTB shouldn't be looking anywhere near 450k for a FTB property lol. To echo those people - wahwahwah if you need the 2k topup from the government maybe you shouldn't be buying a 550k property in the first place.

 

[dowie]

The 450k hard limit is ridiculous. You're either a first time buyer or you're not. It doesn't matter where you live, everything is relative. You have to ask yourself why the government is putting in arbitrary limits/penalties simply for saving money that I have already paid tax on once.

Haven't you been moaning about landlords for years? Now you want to spend seemingly over half a million on a property? It seems like you could have likely bought much sooner instead of renting in a fancier area than you could afford but simply wanted to "have your cake and eat it" so to speak.

This new scheme applies to up to 600k AFAIK, I can see why the public might think it is a bit off to start subsidizing people who are able to afford well over the national average house price.

You didn't reply to the previous post earlier in the thread:

So you currently find some utility in renting - your landlord is actually providing a useful service to you?

You have a bigger deposit than 5% but have chosen not to buy right? I got the impression in other threads that you were a bit bitter about handing over money to some landlord yet you don't seem to be willing to take on that financial commitment yourself either?

 

[Deleted User 298457]

Withdraw the money before 6 April and the penalty is equivalent to losing the bonus the government gave you to help buy a property within the scheme rules.

Didn't even realise this. What exactly is your problem @Scam ? You've had your cake, eaten it, partnered up with someone else to double the size of your cake?

Are mad you aren't getting the 25% top-up, or what?

 

[HACO]

would need to be 2.5% to make sense. 80% risk reduction, anything near to 4.5 would be taking advantage.

Interest rate on 90% LTV mortgages is about 3-3.5% now, do you really expect these new 95% LTV mortgages to have a lower interest rate?

Taking advantage is the whole point. This program is a subsidy to the banks, nothing more. At best, this is a government run credit insurance on subprime mortgage securities.

 

[413x]

Can't see how Lisa is a bad thing?
Like said. It was clear in Ts&Cs the penalty

I think it gave me 4-5k for free!

 

[Deleted User 298457]

Can't see how Lisa is a bad thing?
Like said. It was clear in Ts&Cs the penalty

I think it gave me 4-5k for free!

Yep. And they even got rid of the penalty to withdraw until next month so if you change your mind you can pull your cash out at zero cost.

Would love to see the response from the MP. Probably just:

Dear @Scam ,



Regs,
MP

 

[HACO]

Can't see how Lisa is a bad thing?
Like said. It was clear in Ts&Cs the penalty

I think it gave me 4-5k for free!

It's bad not because of those reasons, but because it's a failed attempt at a bandaid on a much bigger problem (housing crisis) that they don't want to address. But yeah, being mad over the £450k limit makes no sense. The withdrawal penalty and price limits are also pretty well advertised so it's not like people didn't know what they were signing up for.

And if you can't use it for house deposit, you can use it for retirement anyway. People can pretend like it's a tax-free pension.