Court of Appeal clarifies meaning of ‘arrears’ in mortgage case  

The Court of Appeal clarified the meaning of ‘arrears’ under the debt respite scheme in a mortgage case involving lenders Interbay and Seculink and borrower David Forbes. Forbes, who had fallen into arrears, applied for a mental health crisis moratorium. This was the first time the court considered how 2020 protections applied to secured debts, particularly called-in capital sums. The court ruled that the principal amount of secured debt, even if called in before a moratorium, was non-eligible. This decision provided welcome certainty for creditors, confirming the scheme does not restrict enforcement of secured lending beyond missed instalment payments.

Santander agrees TSB purchase to make it fourth largest UK mortgage lender

Santander agreed to acquire TSB for £2.65bn, a move set to establish it as the UK’s fourth-largest mortgage lender. The Spanish banking group stated this acquisition strengthens its position in a core market, expanding its customer base and lending capacity. The deal, agreed with TSB-owner Banco Sabadell, aimed to deliver substantial value through increased market scale, access to low-risk mortgages, and operational efficiencies. This purchase marked Santander’s continued investment in the UK market, despite earlier reports of a potential withdrawal.

FCA lifts broker fees by 2.4% for coming year

The Financial Conduct Authority increased fees for mortgage lenders and brokers by 2.4% for the 2025/26 financial year, following a significant rise last year. The regulator’s overall annual funding requirement grew to £783.5m. Fees for ‘home finance providers, advisers and arrangers’ totalled £23.5m. Additionally, the minimum flat rate levy for mortgage advisers for the Financial Ombudsman Service rose to £95, and money guidance levies for the A.18 group also saw a 32% increase.

Nationwide cuts rates to as low as 3.81%

Nationwide Building Society reduced interest rates on various mortgage products, aiming to attract first-time buyers and existing customers. Reductions of up to 0.20% applied to two, three, and five-year fixed rates across different loan-to-value tiers. New rates started from 3.81% for new and existing customers moving home, and 3.94% for first-time buyers. Remortgage products also saw cuts, starting from 3.89%. This move followed similar rate reductions by other major lenders, providing welcome news for borrowers seeking new deals.

BoE mortgage stats paint a more positive picture

Bank of England data revealed a more positive mortgage market in May after April’s weak figures. Net borrowing of mortgage debt by individuals rose to £2.1bn, and the annual growth rate for net mortgage lending slightly increased. Net mortgage approvals for house purchases grew by 2,400 to 63,000, marking the first increase since December 2024. Approvals for remortgaging also rose significantly. Experts noted these trends indicated increased consumer affordability and lender confidence, potentially driven by easing interest rates.

What lies ahead for house prices?

After an initial post-stamp duty slowdown, the UK housing market showed signs of recalibration and a mixed picture. While Rightmove reported a record average asking price in May, a 10-year high in listings indicated a buyer-favoured market. Zoopla’s index showed a bounceback in sales, attributed to increased stock and eased mortgage affordability. Experts predicted modest house price growth for 2025 and beyond, with regional variations. The market’s future remained dependent on inflation, interest rates, and continued housing undersupply, with some smaller landlords exiting the market.

Santander allows borrowers to choose product transfer deal start dates 

Santander implemented new flexibility for product transfer start dates for brokers’ clients. From Friday, for lower fixed-rate or short-term tracker loans, customers could choose to start their new deal immediately upon offer acceptance or the day after their current deal ended. For the same or higher rates, the new product commenced the day after the existing deal concluded. Standard variable rate or lifetime tracker products allowed immediate transfer. This policy also applies to unaccepted offers issued before July 4th.

Softening jobs market sign of ‘downwards’ rate path: BoE Bailey

Bank of England Governor Andrew Bailey reiterated his forecast for gradually falling interest rates, citing a softening jobs market. He noted that average wage growth had slowed, which he believed would help bring inflation down to the 2% target. While the Monetary Policy Committee desired wage growth below 5%, Bailey indicated that signs of labour market softening could provide confidence for future borrowing cost reductions. Investors anticipated further quarter-point rate cuts by year-end, with a high probability of a cut next month.

Halifax trims prices by up to 10bps, Santander cut rates by up to 16bps  

Halifax and Santander both announced rate reductions across various mortgage products. Halifax trimmed rates by up to 10 basis points on residential homemover, first-time buyer, remortgage, and product transfer deals, also extending completion dates. Santander cut rates by up to 16 basis points on new business first-time buyers, homemovers, and landlord ranges, including specific new build and buy-to-let products. These adjustments reflected a competitive mortgage market, aiming to attract diverse borrowers with improved fixed-rate offers.

Barclays lowers remo rates to 3.93%, HSBC and Market Harborough cut prices

Barclays significantly reduced residential remortgage and purchase rates, including a five-year fixed remortgage to 3.93%. HSBC also lowered residential and buy-to-let rates across various fixed and remortgage products. Concurrently, Market Harborough Building Society trimmed its standard variable rate to 7.59% and cut residential and let mortgage rates, including those for expats, with variable rates reduced by up to 0.45%. These widespread cuts reflected a competitive market, driven by falling swap rates and expectations of a future Bank of England base rate cut.