Mortgage cheer at Tesco's 1.99% rate
HOMEBUYERS got a boost last night when Tesco slashed mortgage rates to less than two per cent.
It is offering a two-year fixed deal at 1.99 per cent, down from 2.64 per cent, and makes the supermarket giant a leader in the mortgage market.
Although borrowers will have to fork out a hefty 40 per cent deposit, they will be able to collect Clubcard points on their payments.
Tesco also slashed the rate on another of its two-year deals from 2.79 per cent to 2.39 per cent for borrowers with a 30 per cent deposit.
The move was welcomed last night by consumer groups who urged other lenders to follow suit.
Marc Gander, founder of Consumer Action Group, said: “This is fantastic news for homebuyers. I hope others will make similar cuts and make things a little easier for people in the recent climate of price rises.”
This is fantastic news for homebuyers
Tesco said it was able to cut its rates due to a Government scheme to kick-start lending by offering banks access to
cheap funding.
Both the Tesco deals carry fees of £995 and are available to customers who are re-mortgaging or buying a new home.
Tesco launched into the mortgage market in August and also offers banking and insurance products, with plans to
launch cash Isas before the next tax year.