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Stamp duty paid! The mortgage lenders promising to pay £2,500 for first-time buyers

Published 21st Mar 2012

Banks are hoping to woo first-time buyers who have missed the chance to pay no stamp duty.

The Government’s stamp duty holiday means that until Saturday, first-time buyers do not pay the tax on properties worth £250,000 and under.

But from next week, anyone buying a house worth between £125,001 and £250,000 will pay 1 per cent stamp duty.

Now Halifax is offering to pay half of first-time buyers’ stamp duty - but buyers should do their sums carefully before signing up.

Its two-year fixed mortgage rate is available to those with a 10 per cent or 15 per cent deposit and comes with no fee. However, the rate is expensive at 5.99 per cent. Monthly repayments on a £150,000 mortgage would be £966.

Meanwhile, The Co-operative Bank has launched fee-free deals that require only a 10 per cent deposit.

Its lifetime tracker is pegged at 4.09 per cent above base, giving a current rate of 4.59 per cent. Monthly repayments would currently be £841.

The Co-op also has a three-year fixed-rate at 4.69 per cent, meaning monthly repayments of £850.

Someone buying a £150,000 house would pay £1,500 stamp duty, so could save £750 with the Halifax offer.

However, you may be able to save more than this in the long term by opting for a cheaper mortgage rate.

Rachel Springall, of comparison site Moneyfacts, says: ‘Every penny counts for first-time buyers, so fee-free deals are a good idea. When looking at any mortgage, always take into account both the fee and the interest rate.’

Source: ' ThisIsMoney '

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