Barclays and HSBC have both made rate reductions on select products, effective from tomorrow (5 July).

Barclays has lowered rates on its residential products including the existing mortgage customer (EMC) reward 75% loan-to-value (LTV) two-year fix, which has been cut by 0.25% from 4.90% to 4.75%. This comes with a product fee of £999, minimum loan £5k and maximum loan £2m.

Other reductions in the residential range include:

• 5.65% EMC Reward two-year fixed £999 product fee, 85% LTV, min loan £5k, max loan £2m, will decrease to 5.22% • 5.83% EMC Reward two-year fixed £0 product fee, 85% LTV, min loan £5k, max loan £2m, will decrease to 5.43%

In the lender’s buy-to-let (BTL) range, the EMC reward 65% LTV two-year fixed will be cut from 5.50% to 5.30%. This comes with no product fee, minimum loan of £5k and maximum loan of £1m.

Further BTL reductions include:

• 5.20% EMC Reward BTL two-year fixed £1,795 product fee, 75% LTV, Min loan £5k, Max loan £1m, will decrease to 5.00% • 5.15% EMC Reward BTL two-year fixed £1,795 product fee, 65% LTV, Min loan £5k, Max loan £1m, will decrease to 4.95%

Meanwhile, HSBC has announced cuts across various ranges. These include existing residential customer switching, existing residential customer borrowing more, residential first-time buyer (FTB)/home move and the equivalent energy efficient version.

Changes will also be made on residential remortgage, residential remortgage cashback, remortgage energy efficient ranges and international residential mortgages.

The bank has introduced a cashback incentive offering on its UK residential FTB products at 60%, 70% and 75% LTV.

In addition, it has increased the cashback incentive offering on its UK residential FTB energy efficient Homes range (A&B EPC rated properties) at 60%, 70% and 75% LTV.

The moves come as sonia two-year swap rates lifted to 4.480% on 2 July from 4.612% on 3 June, while five-year rates were down to 3.983% from 4.053% over the same period. 

Commenting on the changes, SPF Private Clients chief executive Mark Harris says: ‘With the big five lenders – Barclays, HSBC, Santander, Halifax and NatWest – reducing their mortgage rates this week, lenders continue to jostle for business as they ramp up the summer sales.”

“Those lenders who haven’t yet repriced are likely to follow suit, as long as service levels allow.

“Even though Swap rates, which underpin the pricing of fixed-rate mortgages, are not showing a consistent downwards trend, the need to generate more business seems to be motivating lenders to tweak their rates.

“It’s good news for borrowers, many of whom are struggling with affordability after successive rate rises and then holds. Expectations of a rate reduction in August are high.”