TSB has made changes to its mortgage range and has increased its mortgage cashback offer.
In an announcement at the end of March, the bank said it had updated its mortgage range, with more products now available and changes to rates by up to 0.25 per cent.
The range includes a five-year fixed rate loan for 0-90 per cent loan-to-value (LTV) with £995 product fee for remortgage borrowers.
There is also a 10-year fixed rate option with a 10-year early repayment charge for remortgage borrowers and home buyers, as well as shared ownership and shared equity products.
The bank said it had also doubled its cashback offer for home buyers with 85-95 per cent LTV products, from £250 to £500.
TSB is not the only lender to have recently launched cashback propositions.
Last month, Sainsbury’s Bank unveiled four new 95 per cent LTV mortgage products aimed at first and second-time buyers.
The rates included two-year fixed rates at 3.49 per cent and five-year rates from 3.99 per cent, each with £250 cashback and free valuation.
When M&S Bank launched its mortgages at the start of the year it also announced that first-time buyers would get £1,000 cashback as well.
This move will be a draw for first-time buyers who struggle to get on the ladder owing to high deposits and stamp duty where the property price is more than £300,000.
At the end of last year TSB also made some changes to its buy-to-let offering.
Financial Adviser reported that the bank had launched two-year fixes with a £995 fee for buy-to-let borrowers looking to purchase or remortgage, with rates starting from 1.79 per cent for house purchasers with a 40 per cent deposit.
TSB also cut its two-year fixed rate products for shared ownership and shared equity borrowers looking to move house. Reductions of up to 0.2 percentage points mean the rates for these two-year loans start at 1.54 per cent for up to 75 per cent LTV, with a £995 product fee.
Provider view
A TSB spokesperson said: “We regularly review our product range and pricing, which means sometimes prices go up and sometimes they go down. Similarly, sometimes we introduce products and sometimes we remove them. It’s really important to us that we continue to deliver great service to our brokers and customers, and also provide competitive products to borrowers.”
Adviser view
Alan Lakey, director at Highclere Mortgages, said: “Looking at its competitive position, I can see that [this product] fares badly compared with NatWest.
“TSB’s rate with cutback is 2.49 per cent, while the 2.29 per cent rate is only available if the borrowers forego the cutback. NatWest offers a five-year fixed rate of 2.14 per cent, also with £500 cashback.”
Charges
Product fee is £995.
Verdict
The increased cashback offer is a very attractive proposition, particularly for first-time buyers who will be trying to raise cash to pay for all the different fees that are required when buying a home. It remains to be seen if TSB’s offering will be competitive enough to grab market share.
