UCB Home Loans today launches a new mortgage that provides borrowers with 5% cashback.
The product is a five-year tracker based on the Bank of England base rate plus 1.99%, giving it a current interest rate of 5.99%. It is only available for a limited period.
UCB, Nationwide's specialist self-certification lender, has made the mortgage available to both first-time buyers and those who have owned a home before, including those who are remortgaging though the deal is not available on buy-to-let mortgages.
The loan-to-value limit on the product is 85%, effectively providing the borrower with 90% of the purchase price when the 5% cashback is included, with a standard processing fee ranging from £199 to £299, plus a £295 arrangement fee.
Charles Reed, managing director at UCB Home Loans, says: “Nationwide's latest figures show that the average deposit a first-time buyer needs to raise has increased dramatically over recent years, from £5,000 in 1996 to over £18,000 in 2001 for the UK, and over £31,000 in London.
“Cashbacks have been a regular and popular feature in our product portfolio and this product may appeal to first-time buyers, who often find their savings are stretched to cover all the expenses of a property purchase.”