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Mortgage wars: Nationwide, Barclays, TSB and Halifax make rate cuts

Mortgage wars: Nationwide, Barclays, TSB and Halifax make rate cuts
Your Money
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Your Money

Lenders have made another batch of significant cuts to mortgage rates this week, as the battle to win over homeowners continues.

Last week Nationwide reduced rates across the majority of its fixed rate mortgages by up to 0.45% across products for first-time buyers, homeowners remortgaging and switching borrowers.

The mutual has dropped the rate of a three-year fix at 60% loan-to-value (LTV) to 4.99%. Its five-year fix has been clipped by 0.2% to 4.74%, while the current average rate stands at 4.98% – down from 5.80% a year ago.

For those with a 10% deposit (90% LTV), the five-year fixed rate has been cut by 0.15% to 5.25%, with all deals coming with a £999 fee.

Meanwhile, Barclays introduced further reductions of rates on a selection of products across its residential, buy to let and reward ranges.

Its five-year fixed up to 85% LTV comes with a £999 product fee, and it has decreased from 5.63% to 5.43%. This is available from a minimum borrowing of £5,000 to a maximum of £2m.

Halifax rates will ‘strike a fine balance between both worlds’

The five-year fixed ‘great escape’ deal up to 85% LTV, with no product fee, has been slashed by 0.20% – from 5.85% to 5.65%.

Halifax is introducing three-year fixed rate remortgage products at 5.28% up to 60% LTV with no fee included. This rate comes in at 5.08% when a £999 fee is included.

Three-year fixes without a fee for a higher LTV up to 90% are on offer to homeowners for 5.84% and at 5.64% with a £999 fee.

Nicholas Mendes, mortgage expert at John Charcol, said: “A much-needed addition to the three-year fixed rate proposition from Halifax, we’ve seen many mortgage holders opting against a two-year fixed due to the rate but equally cautious with opting for a higher five-year fixed rate.

“This latest edition from Halifax will help ease the pressure but also strike a fine balance between both worlds for mortgage holders.”

Elsewhere, TSB joined the wave of reductions by dropping rates on two- and three-year fixed residential, product transfer and additional borrowing rates by up to 0.50%. This includes the launch of a new three-year fixed rate at 4.99%, available to first-time buyers and home movers.

‘The trend of steady rate-drops to continue’

App-based lender Atom bank also added further reduced rates across its mortgage products by 0.10%, geared towards homeowners with poor credit ratings.

The lender has made the cuts on its five-year ‘near prime’ purchase and remortgage products and has made bigger reductions of up to 0.20% on its three-year rates for ‘prime’ accounts too.

Rightmove expert, Matt Smith, said: “The average two-year fixed mortgage rate is now below 6%, which while still very high compared to the ultra-low levels of recent years, is further evidence of the positive downward trend of fixed rates. Average rates have fallen fractionally across all loan-to-value brackets this week, with all rates now lower than this time last year, though this does compare to the post mini-Budget period.”

He added: “We expect the trend of steady rate drops to continue for now, and the next key highlight to look out for will hopefully be a sub-5% rate on offer in the important mass-market 85% LTV bracket.”