For many first-time buyers, saving enough for a deposit can feel like the biggest hurdle to getting onto the property ladder. A Lifetime ISA (also referred to as ‘LISA’) is designed to help first-time buyers by rewarding your savings with a government bonus, potentially giving your deposit a significant boost.

However, while the financial benefits are well known, many first-time buyers are surprised to learn that their conveyancing solicitor plays an important role in the process.

At Gepp Solicitors, our experienced Residential Conveyancing team regularly helps first-time buyers use Lifetime ISAs as part of their property purchase.

Here’s what first-time buyers need to know about using a Lifetime ISA before they start their property search.

What is a Lifetime ISA?

A Lifetime ISA is a government-backed savings account that helps eligible people save towards either their first home or retirement.

If you’re aged between 18 and 39, you can open a Lifetime ISA. You can save up to £4,000 each tax year until the age of 50, receiving a government bonus of 25% on eligible contributions.

For example:

  • Save £4,000 and receive a £1,000 government bonus.
  • Save £8,000 over two years and receive £2,000 in bonuses.
  • Save £20,000 over five years and receive £5,000 in government contributions.

Over time, these bonuses can make a real difference when building a deposit for your first home.

Who can use a Lifetime ISA to buy a property?

To use your Lifetime ISA without paying a withdrawal charge, certain conditions must be met.

Generally:

  • You must be a first-time buyer and meet the Lifetime ISA eligibility requirements.
  • The Lifetime ISA must have met the qualifying 12-month period before the funds can be used towards a property purchase. (Be aware that the 12-month period will begin from the date of the initial deposit into the Lifetime ISA Account, not from the date the Lifetime ISA Account was opened).
  • The property must be in the UK.
  • The purchase must be funded with a mortgage (subject to limited exceptions).
  • The property must be your intended main residence.
  • The purchase price must not exceed the current Lifetime ISA property value limit (currently £450,000, which applies to both sole and joint purchasers).

Meeting these requirements is essential before your funds can be released.

Why does your conveyancing solicitor matter?

One of the biggest misconceptions is that you simply withdraw the money yourself.

In reality, your conveyancing solicitor is responsible for requesting the Lifetime ISA funds from your provider. Once the purchase is progressing, they complete the required declarations confirming that the transaction meets the scheme’s rules. The funds are then released directly to the solicitor’s client account prior to exchange of contracts which are used towards your purchase.

This process helps protect both buyers and the scheme, ensuring the money is used for its intended purpose.

Tell your solicitor as early as possible

If you’re planning to use a Lifetime ISA, let your conveyancing solicitor know as soon as you instruct them to avoid any potential delays or complications with your transaction.

Early notification allows your solicitor to:

  • confirm that your purchase is eligible
  • obtain the necessary information from your provider
  • request your funds at the appropriate stage of the transaction (depending on the Lifetime ISA provider it can take up to 10-15 working days for the funds to be released).
  • help avoid delays close to exchange of contracts or completion.

Leaving this until the last minute could slow down your purchase.

Common mistakes first-time buyers should avoid

Opening your account too late

Your Lifetime ISA must usually have met the qualifying 12-month period before it can be used towards a property purchase. If your Lifetime ISA has not been open for at least 12 months, you may be unable to use it for your purchase without incurring an ‘early withdrawal charge’, and you could lose some of the value of your savings.

Simply opening the account is not always enough – you should make your first qualifying contribution as soon as possible. Delaying your initial payment could mean you are unable to use your Lifetime ISA when you come to buy a property, even if the account itself was opened more than 12 months earlier.

Exceeding the purchase price limit

Lifetime ISAs can only be used for qualifying purchases up to the current maximum property value (currently a maximum of £450,000). If the purchase price exceeds this limit, you may not be able to use the funds without incurring a withdrawal charge.

Forgetting both buyers may be eligible

If you’re buying jointly, each eligible Lifetime ISA holder can use their own savings and government bonus towards the purchase. This could potentially double the amount available towards your deposit. However, remember that the Lifetime ISA property value limit applies to the total purchase price, not each buyer’s share.

Not mentioning your Lifetime ISA

Your solicitor cannot request the funds if they don’t know you have one. Mention it at the outset of the transaction to help keep everything running smoothly and avoid any potential delays or complications with your transaction.

Lifetime ISAs are changing

The Government has recently consulted on introducing a new First-Time Buyer ISA, which could replace the Lifetime ISA for new savers in the future.

While existing Lifetime ISA holders are expected to continue under the current rules, anyone considering opening a new account should ensure they understand the latest position before making financial decisions.

How Gepp Solicitors can help

Buying your first home is an exciting milestone, but the conveyancing process can sometimes feel daunting.

Our experienced Residential Conveyancing team in Chelmsford, provides clear, practical advice throughout your transaction, including helping buyers who are using a Lifetime ISA as part of the transaction.

We’ll guide you through every stage of your purchase, request your Lifetime ISA funds at the appropriate time, liaise with your lender and the seller’s solicitor, and work proactively to help keep your transaction progressing as smoothly as possible.

Whether you’re buying your very first home or simply want reassurance that everything is being handled correctly, we’re here to help.

Thinking of buying your first home?

Contact Gepp Solicitors’ Residential Conveyancing team to discuss your purchase and find out how we can support you from instruction through to completion.

Call: 01245 343980
Email: newbusiness@gepp.co.uk

Frequently asked questions:

Please note: This article is intended for general information only and should not be relied upon as legal or financial advice. The information was correct at the time of publication (4 August 2026) but may be subject to change.

Every property transaction is unique, and the information provided may not apply to your individual circumstances. If you require advice tailored to your circumstances, please contact Gepp Solicitors’ Residential Conveyancing team.