Halifax council tax offer signals return of incentives for borrowers

Published 18th Apr 2009

Halifax is resurrecting the practice of offering large incentives to entice mortgage customers, the first time that has been done since the credit crunch hit two years ago.

From Monday, Britain’s biggest mortgage lender, which is part of the state-controlled Lloyds Banking Group, will offer to pay up to £1,000 of a homebuyer’s council tax bill for a year when they take out any Halifax mortgage for a new home with a deposit of at least 10 per cent.

Although many lenders have been offering free legal advice or property evaluations in recent months in an effort to lure new customers, Halifax is the first bank to revert to the eye-catching deals that were prevalent before the housing market crashed.

Halifax charges 4.15 per cent interest on a fixed-rate mortgage deal for those with a 40 per cent deposit, and those with a 10 per cent downpayment must pay nearly 7 per cent for a five-year fix. Buyers with a smaller downpayment do not qualify for any deal at all. For the average household, in council tax band D, the latest Halifax inducement would save the purchaser only £580.

Mortgage brokers said that, although the signs of more lively competition in the market were to be commended, the rates on the deal were not particularly competitive.

Source: ' times '

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