Recent developments in the UK banking sector reveal that several prominent banks have lowered mortgage rates significantly. NatWest, Barclays, Santander, and Nationwide Building Society are leading the charge with reductions following a competitive trend among lenders.
UK Banks Slash Mortgage Rates to 4.69%
NatWest has decreased its two-year fixed rate purchase mortgage, which comes with no product fee, from 4.81% to 4.69% for loans at 95% loan-to-value (LTV). Similarly, Barclays has reduced its two-year residential purchase mortgage rate from 4.92% to 4.60% at the same LTV ratio.
Additional Rate Cuts from Major Lenders
These changes come on the heels of Santander’s recent announcements, where cuts of up to 0.32% have been implemented for mortgages at 85%, 90%, and 95% LTV. Nationwide also made adjustments, decreasing rates by up to 0.16% up to 95% LTV.
- NatWest: 2-year fixed rate mortgage at 4.69% (from 4.81%) for 95% LTV
- Barclays: 2-year mortgage at 4.60% (from 4.92%) for 95% LTV
- Santander: Cuts of up to 0.32% for various LTVs
- Nationwide: Decreases of up to 0.16% for mortgages at 95% LTV
Market Trends and Borrower Activity
Rohit Kohli, Director at The Mortgage Stop, provided insights into these changes. He highlighted that two and five-year swap rates have been falling. The two-year swap rate is nearing its lowest level in years.
Kohli noted that the market is anticipating potential base rate cuts, influenced by weaker employment data and sluggish economic growth. He also observed a marked increase in first-time buyers’ activity compared to 12 to 18 months ago.
Support for Borrowers with Smaller Deposits
By reducing rates at the 90% and 95% LTV tiers, NatWest is actively supporting borrowers with smaller down payments, emphasizing inclusivity for those not benefiting from existing equity in their homes.
As competition among lenders continues to grow, potential homebuyers can look forward to more favorable mortgage options in the coming months. Keep up to date with the latest financial news and updates on the cost of living through El-Balad.
