Virgin Money and Lloyds Bank have become the first lenders to announce new mortgage deals in the new year, with cashback offers being a feature of both.
The former has included some higher loan-to-value products designed to help first-time buyers with smaller deposits beat the cost of stamp duty.
Virgin Money’s new stamp duty specials include a two-year fixed rate at 95 per cent LTV, available at 4.29 per cent and a five-year fixed rate at 95 per cent LTV, available at 4.79 per cent, both with no product fee and £1,500 cashback.
In its residential range, there is a new two-year fixed rate at 95 per cent LTV, reduced by 0.31 per cent to 3.98 per cent and a five-year fixed rate at 95 per cent LTV, reduced by 0.20 per cent to 4.69 per cent, both with no product fee and £300 cashback.
The lender also has two Help to Buy five-year fixed rates at 75 per cent LTV, one reduced by 0.15 per cent to 2.68 per cent with a £995 product fee, the other down by 0.10 per cent to 2.93 per cent with no product fee - both with £500 cashback.
Meanwhile, Lloyds has extended its existing £500 remortgage cashback offer to include its first-time buyer and homemover range until 28 February.
Any customer with a Club Lloyds current account can also receive a mortgage rate discount of 0.20 per cent.
The offer excludes product transfers, further advances, shared equity (including Help to Buy), shared ownership and large loans of more than £1m.
Andrew Montlake, director at Coreco Mortgage Brokers, told FTAdviser the first shots of 2016’s lending battle have been fired and it is interesting to see that cashbacks feature, as lenders look to help buyers who are putting all their available resources towards a deposit.
“No doubt other lenders will follow suit and I would expect to see keener rates, especially in the high loan-to-value market, as lenders look to get off to a flying start in 2016. This first quarter looks like it will be a busy one.”
peter.walker@ft.com
