Purchasing a house of your own is one of the most ardent desires of every person, and it is for this reason that most individuals belonging to the low-income groups keep saving so that they can finance their own house. However, as a matter of fact, buying a home is not at all easy especially in the present times when the ratio of income to expenditure is giving people a cold sweat. In such a scenario, borrowing serves as the last option under which different financial institutions and firms allow people to borrow money from them so that the people can finance their dream of a house. Having said that, the bottom line of these schemes launched by private institutions is that they do not enjoy the trust and confidence of the people. Most of the middle-class citizens do not rely on these schemes and require an authorization of the government. It is for this reason that when the government launched the Help to Buy Isa, people readily invested in the scheme since it offered them security.
The why of the scheme
The scheme is basically for first-time buyers and is aimed at providing them with reliable funds so that they can buy houses for themselves. This scheme launched by the government requires people who have invested in it to make a deposit of 12000 bucks initially, and once they are a part of the plan, they shall be able to save 200 bucks every month. Additionally, there is also a boost of 25 cents whenever the individual buys his first home.
The hard-hitting reality
Although the scheme is said to be really economic for the first time buyers as it takes the pressure away from them by offering them with a decent amount of money. However, not many are aware of the reality of the scheme which makes it a bad trade. The bonus that forms an integral part of the scheme is not paid to the person until the contracts are actually being exchanged by the parties. This is to say that the bonus offered by the scheme will not be a part of the deposit value. The scheme is not suitable for the middle-income groups for the very reason that they have to borrow a fairly significant amount of money for the purpose of bridging the gap so as to touch the 1400 mark.
The consequences of the scheme are totally opposite to the intent of the actual scheme which is why the government has decided to close it. The scheme has forces many first time buyers to either postpone their plans or cancel their contracts or has forced them to borrow money from friends or relatives which itself is a defeat for the scheme.
Thus, the help to buy Isa scheme is a sham and has resulted in huge losses to many people which is why the scheme has suffered a backlash from people.