Rate cuts are boost for borrowers and signal strong competition, says broker
For those coming off fixed rate deals this autumn, the reduction in rates is welcomed, said Nick Mendes, mortgage technical manager at John Charcol.
Rates were reduced across its two- and five-year fixes in HSBC’s residential range for both first-time buyers and homemovers across 60-95% loan to values (LTVs).
Reductions were also made to selected buy-to-let (BTL), international, and green mortgage ranges.
Mendes said recent rate reductions across the market had been largely focused on purchase business, making HSBC’s move to improve remortgage pricing a notable step that could encourage other lenders to follow suit.
He said the cuts were particularly significant as they come despite swap rates rising over the past month, suggesting lenders remain keen to compete for business and pass on savings where possible.
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NatWest rate cuts signal strong competition for remortgage business
NatWest made reductions across its residential range.
The largest reductions were by 17 basis points (bps) on its remortgage deals at 85% and 90% LTV.
On purchase products, two-year fixed rates at 60% and 75% LTV have been cut by up to 0.1 percentage points, with five-year fixes at 60% LTV now starting at 4.95%.
Commenting on the changes, Mendes said the lender’s largest reductions were focused on higher-LTV remortgage deals, “offering some relief for homeowners with smaller deposits or less equity who felt the sharpest increases through September.”
He said the cuts were another sign of growing competition among lenders, particularly as many borrowers approach the end of fixed rate mortgage deals. Mendes noted that NatWest’s decision to lower rates comes despite swap rates increasing over the past month, indicating a strong appetite to attract new business.
Foundation makes reductions up to 0.1%
Foundation has reduced rates by up to 0.1 percentage points across selected BTL products and lowered rates on its holiday let range.
The intermediary-only lender said selected specialist BTL products have been cut by up to 10bps, with rates now starting from 4.99% at 75% LTV.
Foundation has also reduced rates on its two- and five-year holiday let products by 0.1 percentage points. Rates now start from 6.64% for the two-year fix and 6.74% for the five-year fix, both at 75% LTV with a 2% fee.
Alongside the rate reductions, the lender has updated its holiday let criteria to allow property owners to live in their holiday let properties for up to 60 days per year.
Grant Hendry, director of sales at Foundation, said: “Following our announcement just last week, we are pleased to announce further enhancements across our range, including rate reductions and a really exciting upgrade to our holiday let criteria. This move strengthens what is already a very popular product range among intermediaries and their clients.”
