Mortgage cashback is in decline, with the number of available deals offering cashback having dropped off a cliff, according to Moneyfacts.
The financial information provider said that the number of cashback deals has fallen by a staggering 280 in just one year, from 974 last June to 694 today.
The average amount offered as cashback has also dipped from £479 a year ago to £343 today, as lenders pull back what were highly competitive and appealing deals.
Charlotte Nelson, finance expert at Moneyfacts.co.uk, said: “The research findings are disappointing, particularly given the high level of competition that currently exists in the mortgage market. In the past, incentive packages with a cashback offer enabled borrowers with limited budgets to ease the upfront costs of securing a mortgage, but anyone looking for this ‘freebie’ today would struggle, as not only is the number of deals in decline but the average size of the rebate has also fallen.
“The mortgage rate-cutting frenzy of last year has faded away, so it would be fair to assume that providers are turning to other tactics to attract the attention of borrowers. However, this does not appear to be the case. This could be because borrowers have grown wise to provider marketing tactics or it may be because lenders are paring back their mortgages to the bare minimum in order to compensate for their record low rates.”
