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Major lender launches stamp duty cashback mortgage

Posted 22 February 2017

A new Barclays mortgage product introduces an incentive to attract homebuyers by covering the cost of stamp duty on their new home...

One of the UK’s major lenders has launched a new mortgage scheme aimed at helping first-time buyers and home movers to pay the stamp duty associated with the purchase of their property.

Barclays has rolled out a ‘Homebuyer Cashback mortgage’ designed to offer cashback to new purchasers looking for help to meet the substantial costs of moving.

Buyers can pay their stamp duty with a substantial cashback

The new Barclays mortgage is designed to help buyers to cover some or all of the Stamp Duty Land Tax (SDLT or, usually, simply stamp duty) payable on the purchase of a new property. It offers:

  • Cashback of £1,250 on mortgages of between £100,000 and £150,000
  • Cashback of up to £2,500 on mortgages between £150,000 and £500,000

The mortgage is available as a five-year fixed rate at 2.69% to a maximum of 80% loan-to-value.

The full stamp duty cost will be covered on properties with a value of up to £250,000.

Properties with a value of more than £250,000 will get £2,500 as a contribution to stamp duty costs up to £500,000.  

Barclays Mortgages director Craig Calder says: “This fee-free cashback purchase-only mortgage completely removes one of the major barriers faced by many first-time buyers and home movers, as well as there being no product or valuation fees to pay.

“With a cashback of up to £2,500, it will help first-time buyers move forward and buy their own home much sooner – with the flexibility to spend the cashback to either recover their stamp duty cost or however they wish.”

Barclays launches new fixed-rate deals

Barclays has also made changes to the rest of its residential mortgage range and has increased the loan size ranges up to £10m, many with a fee- free option. The lender has introduced a purchase-only 1.79% two-year fixed mortgage at 60% loan-to-value for overall loans between £5,000 and £500,000. Barclays has also introduced a 1.28% two-year fixed rate at 60% loan-to-value with a £1,499 fee. The mortgage is available for loans between £500,000 and £2m.

Mortgage expert Aaron Strutt says: “Even though more of the lenders are offering cashback incentives, it is unusual for one of them to provide enough money to pay for the stamp duty on a £250,000 purchase. The lenders are coming up with new incentives to make it easier to get on the property ladder and tempt more borrowers into action.” 


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