The First Home Saver allows customers to put away up to £1,000 each month up to three years and pays interest of 0.85%.
The £500 bonus is available to those who save for more than six months and who take out a mortgage with Coventry Building Society.
It is also flexible – which means savers can change the amount they pay in each month and take withdraw funds as needed.
Currently the best rate you’ll find amongst the easy access savings accounts available on the market is 0.60%. This is available on Aldermore’s Double Access Account Issue 1, according to data from Moneyfacts.co.uk.
As an additional feature, The Coventry First Home Saver is available to parents of first-time buyers too. Parents can open an account and receive the £500 bonus when their child buys their first home with a Coventry Building Society mortgage.
Matthew Carter, head of savings and mortgages at Coventry Building Society, said: “We want to help more people to realise their dreams of buying their first home and our First Home Saver account rewards the huge effort people have to make to save for their first step onto the property ladder.
“People building up their first home deposit are among the best savers out there. They have to squirrel away thousands of pounds, often from scratch, while making sacrifices in many other areas of their lives.
“The reward for saving for a first deposit is great and a £500 boost could make a big difference to those starting out as homeowners for the first time.
“This account caters for the Bank of Mum and Dad too. Parents will often help their kids get on the property ladder and they can receive the £500 bonus too if their child buys their first home with us.
“Even without the bonus, the First Home Saver has a competitive interest rate and although it is a regular saver account it gives customers the flexibility to change the amount they pay in, or withdraw from the account as needed.”
Alternatives
First-time buyers can also earn a bonus on their savings using a Lifetime ISA (LISA). Savers under the age of 40 can open one of these accounts, which allows them to put away up to £4,000 a year.
The government pays a 25% bonus on the savings, up to £1,000 each year. Currently interest rates on cash LISAs are between 0.10% and 0.85% but because they are ISAs, this is tax free.
Whilst Coventry’s account provides a bonus only to those who take out a mortgage with the building society, LISAs are not restricted to a specific borrower, therefore first-time buyers can access deals from across the whole market.
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