- Nationwide offers market-best 3.83% 5-year fixed mortgage
- Major lenders, including Barclays and Halifax, continue rate cuts
- Competitive rates driven by base rate drop and lender competition
Major lenders continue to cut mortgage rates daily, with Nationwide launching a new market-best purchase tomorrow.
The building society is preparing a five-year fixed rate of 3.83 per cent, the lowest mortgage available from any lender.
It applies to both new and existing Nationwide customers who are moving house. It costs £1,499. The mortgage has a 4.1 percent interest rate if no fees are paid.
The next best deal is Barclays’ five-year fixed rate for home movers, priced at 3.84 per cent with a reduced charge of £899.
For those remortgaging, the best option is Barclays’ 4.06 per cent five-year fixed rate with a £948 charge.
Halifax also plans to reduce mortgage rates on its three-year fixed packages tomorrow.
Some interest rates will be reduced by up to 0.37 per cent, although the exact details will not be published until then.
Stephen Perkins, managing director of broker Yellow Brick Mortgages, told Newspage that further rate cuts from two of the top participants in the mortgage sector send a clear and powerful message to borrowers.
‘With competition among lenders heating up, this is an excellent time for borrowers to turn their home fantasies into reality.’
NatWest has dropped many mortgage rates and gives first-time buyers some of the finest deals.
Its 4.68% five-year rate is ideal for purchasing a home with a 10% down payment and is only accessible to new consumers.
Santander has also made cutbacks today.
Most major lenders have cut mortgage rates in recent weeks.
This is partly owing to the Bank of England’s reduction of the base rate from 5.25 per cent to 5 per cent at the beginning of August, though lenders had already priced that move in.
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Inflation data, which determines the base rate, will be published tomorrow.
Analysts believe the rate may have risen for the first time this year in July, which might limit the pace of mortgage rate reduction.
Justin Moy, managing director of broker EHF mortgages, told Newspage: “With some potentially unsettling inflation figures on the horizon, it will be interesting to see if lenders sit on their hands for a while.
What are the best two-year fixed mortgage rates?
The mortgages with the lowest interest rates right now are five-year fixed.
This is because many borrowers still expect rates toto fall in the next two years and prefer a two-year fix, forcing banks to give more appealing rates to secure five-year business.
However, experts believe a return to rates below 2%, accessible in 2021 and early 2022, is doubtful, even in five years.
Barclays offers the most competitive two-year fixed rate at 4.22 per cent with an £899 charge. It is available to home buyers with at least a 40% deposit.
NatWest has the best two-year refinancing rate, at 4.34 per cent. It is again reserved for individuals with a 40% deposit, and the buyer must pay a £1,544 charge.
