How to make a Lifetime ISA Withdrawal
(Last Updated: 21/08/2022)
21/08/2022
7
4 min read
Your Lifetime ISA can be used to buy a house as long as the purchase meets with certain criteria. In this article we'll run through what are the qualifying criteria and what is the process to withdraw the funds to buy a house. Click here to find out other information about the Lifetime ISA.
What are the qualifying criteria?
You can use the Lifetime ISA savings and any bonus to put towards a first time buyer's residential purchase if:
- the property costs £450,000 or less (for shared ownership purchases, the full market value is used, not the total you are paying)
- the withdrawal amount cannot exceed the purchase price
- the owner will live in the property after completion (it cannot be a buy to let)
- you are buying with a mortgage
- you are withdrawing 12 months after the first payment into the Lifetime ISA
- you are buying a legal interest in land in England or Wales with a view to the investor becoming a residential property owner
- you use either your Lifetime ISA or Help to Buy ISA - you cannot use both
If you fail any of the above criteria you cannot use your Lifetime ISA to fund your purchase.
Summary of the process to cash in a Lifetime ISA to buy a house or a flat?
- You complete your Lifetime ISA declaration and send this to your Conveyancer
- Your Conveyancer completes their declaration
- Your Conveyancer sends both declarations to your Lifetime ISA Manager
- Lifetime ISA manager pays the requested funds to your Conveyancer
Read on to find out the more detailed process of what you, your Conveyancer and the Lifetime ISA need to do - PLUS we have a 'Frequently Asked Questions'.
What do you need to do?
Complete your Lifetime ISA declaration and send to your Conveyancer. The declaration includes:
- amount to be withdrawn
- Lifetime ISA Manager details including name and full address
- account number
- full address of property being purchase
- confirmation you are a first time buyer and won't use a Help to Buy ISA
- name and address of the seller's conveyancer
- that all the conditions for a charge-free withdrawal for the first time residential purchase are met, or, in the case of a purchase of land with a dwelling which is not yet habitable, when that will take place
- that the information provided is true and complete to the best of their knowledge and belief
What does your Conveyancer do?
Once your conveyancer receives your declaration they will then complete their own declaration whish confirms:
- they are an eligible Conveyancer able to act for drawing down a Lifetime ISA
- a declaration that you’ve received the information from the investor and that you have no reason to believe it to be untrue or incomplete
- purchase price of the property
- a declaration that the amount to be withdrawn will only be released towards covering the purchase price of the property
- details of the Conveyancer's Client Account where the Lifetime ISA will be sent to
- the Conveyancer's unique professional body registration number
- a declaration that the information you’ve provided is true and complete to the best of your knowledge and belief
Within 10 working days after completion your Conveyancer will email the Lifetime ISA Manager with the completion date, account number of Lifetime ISA and the Conveyancer's unique professional body registration number.
What does your Lifetime ISA Manager do?
The Conveyancer sends both declarations to the Lifetime ISA Manager who should pay the amount requested to you within 30 days of receipt of the declaration.
Frequently Asked Questions
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Written by:
Andrew Boast
Andrew started his career in 2000 working within conveyancing solicitor firms and grew hands-on knowledge of a wide variety of conveyancing challenges and solutions. After helping in excess of 50,000 clients in his career, he uses all this experience within his article writing for SAM, mainstream media and his self published book How to Buy a House Without Killing Anyone.
Reviewed by:
Caragh Bailey
Caragh is an excellent writer and copy editor of books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey, property law and mortgage-related articles.
