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Turn your Lifetime ISA into your first home
Find out the next steps to turn your Lifetime ISA into your first set of keys.
Buying your first home with your Lifetime ISA
All that saving has finally paid off and you’re ready to take your first steps onto the property ladder. As a first-time buyer, you can use your Lifetime ISA to help towards purchasing a property.
To be eligible, you must meet the terms set out by the Government:
Personal criteria
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You are a first time buyer
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You are a resident in the UK
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You are aged between 18 and 39 years old
Property criteria
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The property is in the UK
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The property price is £450,000 or less
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You will be living in the property as your main home
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The purchase is of legal interest on land (for example not a houseboat)
Account and withdrawal conditions
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It must be at least 12 months since the first contribution was paid into the Lifetime ISA
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The property is purchased with a loan (mortgage)
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The withdrawal amount is not greater than the purchase price
Next steps to buying your first home with your Lifetime ISA
Simply login to your MyPlans account, click the ‘more’ menu and select ‘withdraw’.
Here’s what to expect:
Forms to complete
- Lifetime ISA House Purchase Investor Declaration Form: This form needs to be printed and completed by you and sent to your conveyancer.
- Lifetime ISA Conveyancer Declaration Form: Your conveyancer will need to print and complete this form.
Next steps
- Once both forms are completed, your conveyancer will post them to us.
- After we receive the forms and verify the information, we’ll directly transfer the requested withdrawal amount to your conveyancer.
- If you’re buying your first home with someone else who also has a Lifetime ISA, they will need to follow the same process with their provider.
- If the home purchase is completed within 90 days, your conveyancer will inform us.
Extensions
- If the purchase isn’t completed within 90 days, you can apply for a 60-day extension, and if needed, an additional 30 days.
- However, if the purchase isn’t finalised after this period, the money from the Lifetime ISA must be returned to us to avoid the 25% Government penalty.
Our Customer Services team is here to help. If you have any questions or need further assistance, please don’t hesitate to reach out to us.
Mortgage Protection
Mortgage protection can provide financial support if you become seriously ill and can’t work. Think of it as a financial safety net that helps to repay your outstanding mortgage in these circumstances, so you have one less thing to worry about.
Protection is personalised and depends on your personal circumstances. Our dedicated Financial Advisers can help guide you through your options at no extra cost to you. They’ll explain your options and the different types of cover.
The Lifetime ISA withdrawal rules
Do I need to make a full withdrawal from my Lifetime ISA?
No, you don’t need to withdraw all the money from your Lifetime ISA for your home purchase. You have the flexibility to choose how much you’d like to withdraw. Any remaining funds will stay in your Lifetime ISA, and you can continue to contribute and benefit from the Government bonus until you are 50.
Remember, any remaining money can be accessed in the Lifetime ISA without a penalty from your 60th birthday onwards. If you withdraw any money before then and it’s not for a qualifying house purchase, the Government penalty will apply.
Understanding the Government penalty charge
It’s important to be aware of the Government withdrawal charge associated with your Lifetime ISA. Here’s what you need to know:
- Eligibility for property purchase: If you’re not using your Lifetime ISA for a property purchase, or if you’re withdrawing your savings for reasons other than buying your first home, or before the age of 60, a 25% Government penalty will be applied to the amount you withdraw.
- Impact on savings: This penalty means you could receive back less than what you originally contributed to your Lifetime ISA.
Why invest with Foresters?
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Managing family finances and making a positive impact for over 150 years
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Get rewards by becoming a Foresters member
If you open an Lifetime ISA with us you become a member, and will have access to a range of exclusive benefits at no cost.
Member benefits are not regulated by the PRA or the FCA and may change in the future.
Supporting you at every step
Contact us
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Seek advice
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Being a first-time buyer
Learn how to finance your life goals with effective saving strategies. Build habits to reach milestones and stay prepared for emergencies.
About member Benefits
Description of member benefits that you may receive assumes you are a Foresters member. Members must be 18 years of age or older and must have an active Foresters Plan and maintain it in good standing. Foresters member benefits are non-contractual, subject to benefit specific eligibility requirements, definitions and limitations and may be changed or cancelled without notice. Member benefits are not regulated by the Prudential Regulation Authority or the Financial Conduct Authority and may change in the future.