Barclays has announced it is offering a loyalty mortgage discount of up to 0.54 per cent for existing customers through its mortgage arm Woolwich.

From next Wednesday 2 September, Barclays will launch its first loyalty mortgages for existing Barclays current account customers who will be rewarded for their loyalty with a reduction on their rate when they take out selected Barclays mortgages.

The Woolwich mortgages in the offer include loans from its tracker, fixed rate, and offset mortgage range, for example: a two year fixed rate mortgage at 2.95 per cent – 0.54 per cent below the standard offer – and up to 70 per cent loan to value; for mortgages up to 80 per cent loan to value, the rate is reduced by 0.19 percentage points to 4.19 per cent.

The customers who are eligible for the discount include Premier, Additions, and Graduate current account customers, who have deposited at least £800 in their accounts for the last three consecutive months when they apply.

After these discounts, borrowers could save £922 in the first two years of their mortgage, Barclays has calculated, based on an average mortgage of £135,000, while for larger mortgages, such as £500,000, the savings could be as much as £3,400.

Commenting on the loyalty discounts, Andy Gray, head of Barclays mortgages, said “We are always looking at how we can offer the most competitive mortgage rates we can and the most deserving people for these are our existing customers. What this new scheme means is that our current account customers will now always have access to discounted rates in our range, as a reward from us to them for their loyalty.”

Mr Gray added: “These loyalty rates supplement the competitive mortgage deals available to new and existing customers from our standard range.”

Last month, Barclays launched a ‘drop-lock’ facility, which enables new tracker and offset customers to choose a low tracker rate while interest rates are low, with the option to switch to a fixed rate in the future when they require greater security, without incurring early repayment charges.

© Fair Investment Company Ltd