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This week’s best residential mortgage products

This week’s best residential mortgage products
Matt Browning
Written By:
Matt Browning
Posted:
15/02/2024
Updated:
15/02/2024

The battle to offer the best mortgage rates has heated up this week, with Cumberland Building Society dominating the first-time buyer market.

It follows a fruitful period of rate cuts that led to the average two-year fixed mortgage rate dropping to 5.56% in February – a level not seen since 2022.

After six months of decreasing rates, a five-year fix now stands at 5.18%, a drop from 5.18% the previous month.

Here are the leading rates on residential mortgage products this week, according to data from Moneyfacts.

The best remortgage rates

Cumberland Building Society continues to offer the best remortgage rate, paying 4.26% for a maximum of 60% loan to value (LTV). The deal has a £999 arrangement fee, while incentives include free legal fees and free valuation (up to £750,000). This Moneyfacts ‘best buy’ offer only applies to homes in Britain.

The next best:

  1. Yorkshire Building Society: The mutual replaces Principality Building Society with a two-year fix priced at 4.49% up to 75% LTV. This also has free valuation and fees, but a chunky completion fee of £1,495 is required too.
  2. MPowered Mortgages: No provider can match the specialist lender for another week. It offers 4.36% up to 60% LTV. This comes with a bigger fee for arrangement costs (£1,999). However, incentives include free legal fees and valuation, plus cashback worth 0.3% of the borrower’s mortgage advance.
  3. NatWest and NatWest Intermediary Solutions: The 3.89% rate remains the leading price for a five-year fix, financing up to 60% of your property. A booking fee of £1,495 is required, while the NatWest deal has an option of complementary valuation and free legal fees. Alternatively, the intermediary provides £250 cashback alongside a free valuation.

The best mortgage rates for home-movers

Santander has swooped into the lead for two-year fixes, replacing Halifax with a rate of 4.20% up to 60% LTV. This Moneyfacts ‘best buy’ comes with a £999 arrangement fee but offers a valuation free of charge.

The top alternatives:

  1. Santander: The provider also boasts the best three-year fixed rate due to its rate of 4.20% up to 60% LTV. The same incentives and fees apply to this deal, which is also a Moneyfacts ‘best buy’.
  2. Nationwide Building Society: The mutual offers 4.39% for a three-year fix and a free valuation as an incentive. This deal also includes a further incentive for environmentally friendly homes. You’ll get £500 cashback if your property’s energy-efficiency rating is 92 or higher, while £250 is available for a slightly lower rating between 86 and 92.
  3. Cumberland Society: Another non-mover in the rankings due to the 3.03% rate on a five-year fix up to 75% LTV. Incentives include a free valuation for properties (up to £750,000), and a £999 charge in arrangement fees is also part of the package.

The best first-time buyer mortgages

In a complete shake-up of the first-time buyer mortgage market, Cumberland Building Society has the market-leading rate of 4.88% for borrowers jumping on the property ladder. It covers valuation costs for homes worth up to £750,000, but a £999 arrangement is also needed on this three-year fix.

The next best:

  1. Cumberland Building Society: As well as leading the two-year fixed rate sector, the mutual also has the best five-year alternative. The deal has the same incentives as its shorter-term counterpart and comes with a 4.43% rate.
  2. Leeds Building Society: The mutual keeps its place as the best two-year fixed rate for buyers with a 5% deposit. It pays 5.15% and fees include a £999 arrangement fee, and an incentive of a free valuation worth up to £999 is also included.
  3. Family Building Society: Paying a 4.79% rate, this mutual continues to offer the best price for five years for buyers who have a 10% deposit ready. A unique feature of this account is that funds from relatives can be considered, so the family of first-time buyers can add their own savings or property as security. The deal is only on offer in England or Wales (excluding the Scilly Isles), and fees include a £599 completion cost, but incentives come in the shape of a complementary valuation worth up to £500,000, as well as £250 cashback.