Newcastle launches first time buyer savings account

A new savings account has been launched by Newcastle Building Society (NBS), in a bid to help people save a deposit to get on the property ladder.

The ‘Newcastle Big Home Saver’ is ideal for aspiring first time buyers who, like many borrowers, need to build up a deposit to buy their first home. It can be opened with as little as just one pound so there is no great hurdle to getting started.

The product pays a competitive variable rate of 2.98% Gross (3.00% AER), which includes a 1% bonus for regular savers who make at least one deposit and no withdrawals in each month.

Importantly, after saving for a deposit, the account can also pay up to a £1,000 cash reward upon completion of a house purchase mortgage with the Newcastle.

For instance, if £5,000 to £9,999 is saved in this account and a mortgage is taken with the Society a cash reward of £500 is paid on mortgage completion. If £10,000 or more is saved a £1,000 cash reward is paid on mortgage completion, helping with the costs involved in buying a home.

Steve Urwin, Sales and Marketing Executive, at NBS, said: “The Newcastle understands how challenging it can be for first time buyers and is committed to helping them. We also recognise that most aspiring first time buyers will at some point need to save for a deposit before buying their first home.

“To do this successfully you need to get into the savings habit early, which is what we’re trying to encourage with our new product. What’s more, the Newcastle Big Home Saver can pay a cash reward of up to £1,000 after saving for a deposit and completing a mortgage with the Newcastle, which is a great reward for saving and can be used to pay for things such as decorating or furnishing your home.”

The account is also available as a tax-free cash ISA, which allows investors to make the most of their savings and permits easy access withdrawals at any time providing flexibility to investors.

The Newcastle believes if a couple plans far enough ahead and each saves, for instance, £250 a month for two years in The Newcastle Big Home Saver ISA, a deposit of £12,377 could be gained. This includes £377 interest, which would be tax free if a couple each saved into the Cash ISA version of this account. Once the potential £1,000 cash reward is added on the homebuyer could have more than £13,000 to put towards the costs of a move.

The account can be opened via newcastle.co.uk.