Multiple lenders reduce mortgage rates following Bank of England reduction
Recently the Bank of England announced a reduction in interest rates, which has prompted multiple lenders to reduce the mortgage rates on its products.
Last week the Bank of England cut interest rates from 4.75% to 4.5%, with the base rate at its lowest since June 2023. This decision means lower mortgage rates and more affordable monthly payments for buyers.
Jason Blunden, Managing Director at Evolve Financial Solutions, said of the cuts: “This is fantastic news. The lowest the base rate has been in 18 months and hopefully the first of several cuts this year. We had already seen lenders starting to lower their rates, but this will certainly add momentum. A fantastic start to the year for buyers.”
Now it appears that the momentum has picked up, as multiple lenders have unveiled reductions in its mortgage rates. Nationwide for instance has dropped its rate by 0.35%.
Santander will now offer mortgage rates below 4% on two and five-year fixed rate terms, making it the provider of some of the lowest rates so far this year, and Barclays has followed suit with its own rates below 4%.
NatWest has made significant reductions to its two and five-year mortgage deals too, cutting them by 16 basis points and 10 basis points respectively.
Basis points are a unit of measurement which is equivalent to one-tenth of a percentage point. The measurement is used as a clear and simplified way to show changes to fees and interest rates when setting mortgages.
The Co-operative Bank has now made reductions to selected tracker and standard variable rates by up to 25 basis points, and TSB has followed suit and reduced some of its residential and landlord variable rates by the same amount.
Additionally, the availability of mortgage deals at 95% loan to value is now at the highest it has been since March 2020. A 95% loan to value mortgage means homebuyers could borrow up to 95% of the value of their new home and just pay a 5% deposit. TSB for example has reintroduced its five-year fixes for first-time buyers and home movers at 90-95 loan to value.
These are significant changes in the market that offer promising options for potential buyers.
For free mortgage advice, call Evolve on 01473 603 211 or visit https://www.evolvefs.com/.
To find out more about our available homes, visit https://allison-homes.co.uk/developments/.
Allison Homes web article: 14th February 2025
