The fixed rate cutting momentum on mortgages continued this week, with numerous lenders making cuts, including high street names.
Moneyfacts finance expert Rachel Springall points out that overall, the reductions pushed the average two-year fixed rate lower to 5.14%, however the average five-year fixed rate was unchanged at 5.10% week-on-week, despite dropping slightly midweek.
The prominent brands to reduce selected fixed rates this week included TSB by up to 0.20%, Santander by up to 0.20%, Lloyds Bank by up to 0.18%, Halifax by up to 0.18%, NatWest and RBS by up to 0.17% and Virgin Money by up to 0.15%.
Building societies made a few rate changes this week, those to cut included Nationwide Building Society by up to 0.30%, Nottingham Building Society by up to 0.14%, Monmouthshire Building Society by up to 0.20%, Darlington Building Society by up to 0.25%, Principality Building Society by up to 0.30%, Leeds Building Society by up to 0.20% and Bath Building Society made cuts of up to 0.30% on its ‘credit repair and rent a room’ fixed rates.
A few more lenders moved to reduce rates such as MPowered Mortgages by up to 0.18%, LendInvest by up to 0.10%, Kensington by up to 0.55% and Gen H by up to 0.20%.
Springall commented: “One of the eye-catching deals to hit the market this week was a two-year fixed rate deal from TSB, priced at 4.84% and available at 90% loan-to-value for second-time buyers. It includes a free valuation and £500 cashback. The deal does not charge a product fee, so it’s a great choice for those looking to save on the upfront cost of their mortgage.
She added: “Lenders were keen to reprice their mortgages this week, which was somewhat expected as swap rates continued to hover around their 30-day lows. There was also an expectation from economists that the Bank of England would cut base rate this week by 0.25%, and the decision to do so led to reductions by lenders on tracker mortgages and diarising cuts on revert rates.
“However, the base rate cut of 0.25% was not a unanimous decision, and such indecisiveness might happen again at the next MPC meeting, particularly if inflation remains sticky. Borrowers should not wait around for too long to compare deals and get their paperwork in order before they refinance this year.
“There may well be a rise in the pool of sub 4% deals, but the best mortgage will come down to the overall true cost and a borrowers individual circumstances.”
