The Scarborough Building Society has again come up with an innovative incentive as part of its new mortgage launch on 28 September.
This time consumers who take out one of the following products are eligible to receive a comprehensive Apple iMac G5 computer package said to be worth £2,600.
*Fixed rate product at 5.29 per cent until 29/11/10 – fee £595.
*Tracker rate 5.29 per cent (variable) to 29/11/06, then 5.44 per cent (variable) to 29/11/10 – no fee.
If the customer borrowed £100,000 over a term of 25 years at the above interest rate, their initial monthly payments would be £601.
If on the other hand, the consumer opted for one of the top five-year fixed rate deals on the market at present such as 4.39 per cent from the Britannia, their initial monthly payments, based upon the same amount and term, would be £549.
Over the course of a five-year term the amount the customer would pay is as follows
Mortgage: Scarborough BS 5.29 per cent
Fee: £595
Monthly repayments x 60 months: £36,060
Total cost over first 5 years: £36,655
Mortgage: Britannia BS 4.39 per cent
Fee: £349
Monthly repayments x 60 months: £32,940
Total cost over first 5 years: £33,289
Rachel McKay, from Moneyfacts.co.uk mortgage team, commented: “Whilst it is always good for competition in the market to see mortgage providers trying innovative product launches, this example shows that consumers could save themselves £3366, which would allow them to buy the Apple iMac computer package and still have money left over, or alternatively spend the money on whatever they wanted.
“However it must be remembered that the £3,366 is saved in the above example is over a five year term, not up front, so if someone is looking for a new mortgage and also wants one of the Apple computer packages, then they may see this as a good deal as they can get their hands on one without having to pay out £2,600 of their own money or taking out a personal loan to pay for it.”
