Do I have to take out a mortgage from my cash Lifetime ISA provider?

Written by: Paloma Kubiak
If you’ve opened a cash Lifetime ISA from a high street lender, you may be wondering whether you’re required to take out a mortgage from that same provider. Our 60 second guide explains more.

There are more than a dozen providers offering the Lifetime ISA – the home and pension hybrid savings scheme backed by the government.

It offers people aged 18-39 the chance to save up to £4,000 each tax year towards a property or retirement where they’ll receive a government bonus of 25% (up to £1,000).

Lifetime ISA (LISA) savers have the option of saving into an investment or cash version. If you’ve opened a cash version from one of the three building societies, do you need to take out a mortgage deal with it once you’re ready to buy your first home?

In short, the answer is no. You’re not required to take out a mortgage from the lender where you have your cash LISA savings. But a couple offer incentives for first-time buyers.

Here’s what the mutual’s told us:

Newcastle Building Society: It just yesterday launched its cash LISA product but confirms that customers are free to get a mortgage elsewhere.

Nottingham Building Society: LISA customers aren’t required to take out a mortgage with the Nottingham. But anyone taking out its LISA will have free access to its whole of the market mortgage advice service, which usually costs £249 for non-members.

Skipton Building Society: It was the first high street lender to launch the cash LISA. While customers aren’t required to take out a mortgage with the Skipton, anyone who does so will receive £250 cash back.

It’s also recently launched an exclusive range of Lifetime ISA mortgages available from 85% and up to 95% loan to value (LTV) on three two-year mortgages and three five-year mortgages with £500 and £1,000 cash back. This is on top of the £250 cash back.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

It’s time to get your finances in shape, and moving your cash savings to a higher paying deal is a good plac...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

The experts’ guide to sorting out your personal finances in 2021

From opting to ‘low spend’ months to imposing your own ‘cooling-off period’, industry experts reveal t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week