Coventry for intermediaries has launched 2-year and 5-year fixed rate residential mortgages, offering £500 cashback for homemovers and first-time buyers on some mortgages.
There’s four products all with the cashback, ERCs payable and a £999 product fee. The highlights include a 2.15% 2-year fixed at 85% loan-to-value, a 2.19% 2-year fixed at 90% LTV, 2.29% at 5-year fixed at 80% LTV and a 5-year fixed rate at 2.45% and 90% LTV.
Ray Boulger, senior technical manager at John Charcol, said: “Coventry has improved its product range, not only by introducing four new mortgages with a £500 cashback but also by cutting the rates on its 2 and 5-year fixed rates by 10 basis points.
“Its 5-year fixed rates at 90% LTV are now particularly competitive but although an extra £500 to help with costs will always be welcome, purchasers borrowing more than £100,000 will generally get better value opting for a lower rate instead of the cashback.
“For example, on Coventry’s 5-year fix to 90% LTV the rate is 2.35% with no cashback or 2.45% with the cashback.”
Aaron Strutt, PR and communications director at Trinity Financial, thought many lenders offer similar cashback deals.
He said: “There’s a selection of lenders offering cashback at the moment so they’re trying to do more to attract business.
“Halifax has a promotion – it’s offering £1,000 cashback to first-time buyer and homemovers.
“Coventry’s fixed rates are normally competitively priced, especially their lower deposit rates. It’s just the latest lender to offer it.”
Dan White, managing director of White Financial Services, was pleased with the product launch.
He said: “Personally I think the cashback offer is great for borrowers because any assistance with fees is great. Any cashback especially on remortgages is great.
“Cashback of £500 without arrangement fees means the borrower can use this cash for legal costs and their savings can then go into the deposit funds.
“Not a lot of first-time buyers will understand additional fees until they see an adviser so any products reducing their costs are great for the market, as long as the service is still there too.”
The cashback incentive will be paid directly to borrowers within 30 days after completion of their mortgage.
The society has also reduced rates by 0.10% on its 5-year fixed residential, offset and first-time buyer members’ only mortgages.
Kevin Purvey, director of intermediaries at Coventry for intermediaries, said: “Our £500 cashback incentive on our 2-year and 5-year fixed rate mortgages will help customers with the cost of moving home, something which proved very popular with our intermediaries last year.
“We are also delighted to reduce rates by 0.10% on our 5-year fixed, offset and first-time buy mortgage products.”