Tesco Bank cuts mortgage rates

Tesco Bank cuts mortgage rates

Tesco Bank has cut the rates on its mortgages by up to 0.12 percentage points.

The products include a two-year 3.18 per cent fixed rate homemover deal at 95 per cent LTV and two-year 2.27 per cent fix at 90 per cent LTV until 30 April 2021. Both products come with £500 cashback and no fees.

Its three-year remortgage deals include a 2.27 per cent fixed rate at 90 per cent LTV, and 2.05 per cent fix at 85 per cent LTV until 30 April 2022, both with a £995 fee.

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Five-year homemover fixed rates are also available at 3.60 per cent and 2.70 per cent respectively, both offering £1,000 cashback.

The bank has also launched two five-year fixed rate remortgage deals with £750 cashback. The rates are 2.64 per cent and 2.37 per cent until 30 April 2024. No fees apply.

Cashback products are only available for customers borrowing more than £100,000 and all products will move onto the Tesco Bank standard variable rate (currently 4.04 per cent) at the end of the initial fixed rate period.

Customers can make overpayments of up to 20 per cent of the outstanding balance each year during the initial rate period without charge, and can collect one Tesco Clubcard point for every £4 on their monthly repayments.

Julian Hartley, director of mortgages, savings and Loans at Tesco Bank, said: "We strive to offer customers great value mortgages and outstanding customer service.

"I am delighted to announce further reductions in our rates across our range of house purchase and remortgage products, ensuring that Tesco Bank mortgages remain amongst the most competitive for customers."

Peter Burdell, mortgage and protection adviser at Options Mortgage Centre, said: "I have placed a few mortgages with Tesco, with the customer being drawn to the Clubcard points incentive.

"However, in terms of criteria and service, Tesco is not quite there yet. Lenders such as HSBC and Halifax have similar or better rates and they are more established, so it will take some time for Tesco to truly compete."