Santander has launched what it claims is a market-leading Help to Buy Isa rate charging 4.00%.
The new tax-free savings rate is available now both to new and existing customers.
Savers who already have a Help to Buy Isa can transfer to the Santander deal to get a better rate, provided they transfer their funds in full.
Helen Bierton, head of savings at Santander said it was aiming to help first time buyers get onto the property ladder.
“Our new Help to Buy Isa offers the opportunity to build a tax-free savings pot and then benefit from a boost to those savings with the Government bonus.”
Under the scheme, savers can deposit up to £1,200 within the first calendar month of funding the account, and then up to £200 monthly thereafter.
Once the account has a balance of £1,600 it qualifies for a Government bonus, meaning even those looking to purchase a property within the next three months could benefit from the scheme.
The Government will pay a bonus of 25% up to £3,000 per person, so boosting a Help to Buy Isa savings pot of £12,000 to £15,000, upon the purchase of a first home.
Each first time buyer can have their own account, so couples could receive a Government bonus of up to £6,000.