First-time buyers nearly lost dream home due to mortgage adviser’s error – and it cost them £4k Help to Buy Isa bonus

A COUPLE from Birmingham nearly missed out on their dream home after being hit with an unexpected £4,000 bill days before they were due to complete the sale.

Alex Moulton, 32, and her partner Matt Priest, 29, had been relying on the 25 per cent Government-paid bonus from their Help To Buy Isa to help with the deposit.

But at the eleventh hour, they were told that their £280,000 house was over the £250,000 Help To Buy limit so they weren't entitled to the free cash - something their mortgage adviser hadn't picked up on.

This drove their deposit up from £12,000 to £16,000 and left Alex, an art teacher, and sales engineer Matt desperately searching for a way to find the extra money.

In the end, Alex's dad was able to lend them them some but it meant that they had no leftover cash for furniture for their new home.

They ended up sticking £2,000 on credit cards in order to kit out the house.

It took the couple three years to save the £12,000 by putting away the maximum £200 each into their Help To Buy Isas.

They also decided to move in with Matt's mum to save on rent - although it meant there were four adults and Alex’s two pet cats all piled into a three bed house.

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Almost a year after getting the keys, Alex sat down with The Sun to warn others about the Help To Buy loopholes for our My First Home series.

What is your house like and what did you pay for it?

My fiance and I bought a four-bed, semi-detached house in a new development in Smethwick, Birmingham, last June.

It’s quite a special house. It overlooks a canal with a view of Birmingham city centre, and you can see the BP Tower in the distance - which is a Birmingham landmark.

Inside we have a kitchen and diner, a living room and three bathrooms. It’s a bit mad actually, we have more toilets than people living here.

Outside there’s loads of parking space, a massive garden and a garage.

We’d love to have the garden landscaped one day - I’ve got big plans for it.

We paid £280,000 for our house, with a 40 per cent - £112,000 - Help To Buy equity loan. We took out a mortgage for the remaining £152,000.

Originally we wanted a period property, but everything we saw was at the top end of our budget and needed a lot of work.

Sometimes I can’t believe how much house we got for our money.

Even now we’re still pinching ourselves, thinking we could never have afforded a house this big if we hadn’t gone for a new build.

How much did you save and how did you do it?

My partner, Matt, and I each saved £6,000 - £12,000 total - over the course of three years.

We got together four years ago and started saving a year later, when we realised we were getting serious.

We both opened Help To Buy Isas and would put £200 a month in it. We did that for nearly two years, and then decided to move out of our rental properties to save even more cash.

We moved in with Matt’s mum, so we could put all our rent money into a savings account - on top of the £200 we were each putting into the Isa.

I’d been paying £550 a month in rent before that, so it freed up a lot of cash.

Our plan was to live with Matt’s mum for a year, so we had enough for a decent deposit, but we only needed to stay 10 months in the end.

Was the Help to Buy Isa worth it?

As we had our money in the government’s Help To Buy Isa, we were expecting to get 25 per cent of our savings back - but found out at the very last minute our property was too expensive to qualify for the discount.

We paid £280,000 for our house - but the maximum cost outside of London is £250,000. It's £450,000 for those in the capital.

Our mortgage adviser didn’t know about that - and nobody had told us - so we only found out when the solicitors on the property developer’s side said they couldn’t sell to us under the Help To Buy scheme.

This meant our deposit was going to cost £16,000 instead of £12,000 - so we had to scramble round at the very final stage to desperately try and find £4,000.

My partner wasn’t really in a position to find any money, and we’d both been saving to the absolute max so had nothing left.

In the end, I had to ask my parents for the money. Thankfully my dad had moved around some of his pension funds to gift me and my two sisters, so they were able to help us out.

What were your moving costs like?

Because we were hit with the unexpected £4,000 cost at the eleventh hour, we had nothing left when we actually moved in.

I’ve had to put an extra £2,000 on credit cards for furniture alone since moving in - but we just had to bite the bullet as it was literally a big, empty shell when we arrived.

It’s a shame, as I thought I’d have a bit more money to furnish it - but luckily we both have big families, so we’ve managed to do a bit of beg, borrowing and stealing to make it a home.

My parents also bought us a sofa set from Sofology, which was a big expense and saved us a lot.

There are lots of things I still want to add. I’d like to do some re-tiling at some point, but I’m keeping a tight rein on things for now as it’s easy to get carried away.

How do your mortgage repayments compare to rent?

Our mortgage repayments on the house are £850 a month, which is quite a bit more than we were paying before.

I’d previously lived in the same rental property for five years. It was a three-bed house and cost £550 a month. That was quite steep when it was just me, but a lot cheaper for the two of us.

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