New first time buyer cashback mortgage

Co-operative Bank has launched a new unique first time buyer cashback mortgage aimed at helping first time buyers (FTB’s) onto the property ladder.

The new mortgage comes with the following features

1% cashback to cover stamp duty or other fees that first time buyers may incur.
4.5x income multiples (5x for graduates)
A fixed rate of 6.29% for 5 years
No deposit required
Guarantor option available
Free basic valuation

New research released by the Co-operative Bank has shown that first time buyers are continuing to struggle in their quest to get onto the first rung of the property ladder. Rising house prices are still the main concern for the majority of people but over half of those questioned believe that the amount needed for a deposit (54%) and stamp duty fees (43%) are preventing first time buyers getting on the property ladder.

Main barriers preventing first time buyers getting on the property ladder

Rising house prices 92%
Amount needed for a deposit 54%
High levels of personal debt 45%
Stamp Duty Fees 43%
Low pay 40%
Solicitors Fees 39%
Expectations are too high 32%
Lack of financial understanding 24%
Worries about job security 24%
Expensive household bills 23%

John Barker, Head of Mortgages at Co-operative Bank comments “As house prices have continued to rise it is important that the lifeblood of the market – First Time Buyers – are given extra help to gain that all important first footing on the ladder. At the Co-operative Bank we believe that new innovative mortgage products such as this should be developed to help alleviate some of the extra worry for first time buyers, by providing them with extra cash to pay for some of the upfront costs associated with home buying such as stamp duty.”

As a responsible lender the Co-operative Bankdoes not impose costly Higher Lending Charges (HLCs) on borrowers who wish to borrow more than 95 per cent of the value of the property. Such charges, which are imposed by some other lenders, can potentially cost consumers up to an additional £2,000 when buying a home.

Also customers benefit from a number of positive environmental features including receiving a free home energy report with their property valuation, which assesses the energy efficiency of the property and identifies ways in which it can be improved.

In addition, for the duration of the mortgage, the Co-operative Bankmakes an annual donation to Climate Care to help tackle global warming. Houses are one of the largest sources of carbon dioxide emissions in the UK and, by using the Bank’s annual donation, Climate Care will be able to offset around one quarter of an average home’s carbon dioxide emissions each year for the lifetime of the mortgage.