If you're looking to get onto the housing ladder in 2013 one major lender is planning to help by paying your stamp duty. Halifax, part of the part taxpayer-owned Lloyds Banking Group, has announced that it will pay stamp duty of up to £2,500 for first-time buyers in an attempt to attract more new homeowners.
For many homebuyers, stamp duty is a major expense that has to be taken into account. The duty is zero up to £125,000 and then charged at 1% up to £250,000, 3% up to £500,000, 4% up to £1million, 5% up to £2million and 7% on purchases over £2million.
Now, Halifax has offered to pay the stamp duty for first-time buyers to a maximum of £2,500. The Daily Telegraph reports that the bank "will pay up to £2,500 to cover the cost of tax on property purchases of between £125,000 and £250,000."
The lender will offer the stamp duty in the form of cashback to first-time buyers on its full mortgage range. One per cent of the property price will be paid to your solicitor on completion. Halifax currently offers a two-year fixed rate of 3.24% if you have a deposit of more than 20%. If you can only put down 15%, the rate rises to 3.79%. There is no arrangement fee.
Craig McKinlay, mortgage director at Halifax, said: "Stamp duty can often be a cost that is overlooked, particularly for buyers who are focused on saving an initial deposit for a house. We're keen to do what we can to support those buying their first home, and eliminate the additional burden of a stamp duty bill at what's already an expensive time."
The Telegraph reports that "analysis conducted by Halifax shows that first-time buyers accounted for 40% of all property purchases in 2012."
"Now that the government's stamp duty holiday has ended, this is a helpful move by Halifax to give a leg-up to first time buyers," says Keith Osborne, editor of WhatHouse.co.uk. "However, as with all mortgage products you should carefully consider the overall cost of the deal. It may be cheaper for you to take a lower interest rate with another lender and forsake the cashback than to accept a Halifax deal and have your stamp duty paid. A broker can help you work out which deal is best for you."
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