Homebuyers are being warned not to be enticed by gimmicky offers from
Scarborough Building Society.
Leading
mortgage brokers are concerned that Scarborough
Building Society is offering trendy electronic
gadgets worth up to £2,600 to borrowers who take out a five year
fixed rate or five year tracker mortgage. Items that have been offered to prospective borrowers have included
iMac computers,
digital cameras and iPods.
To qualify homebuyers would have to borrow a minimum of £50,000 and complete the deal by the end of the month. However, brokers feel that borrowers will end up paying a huge premium for the goods as the
interest rates being offered are not competitive. The fixed rate and the
tracker mortgage start at 5.29 per cent. James Cotton of London &Country brokers, says these
mortgages will be suitable to those who have a mortgage of less than £61,500 and if they want the items on offer.
He says, "The high interest rate and fees offset the ‘free’ equipment for borrowers with a
loan over this amount."
This tactic is not a new one and has been used by Scarborough to lure customers before. Last January they offered new mortgage customers
plasma screen tv's worth £3000.
Melanie Bien of Savills Private
Finance,
independent mortgage broker, warned, "Borrowers are likely to be better off sourcing the
cheapest mortgage and buying goods they want separately."
