The UK’s mortgage price war is heating up as two of the country’s biggest lenders slash interest rates even further.
Santander and Halifax are the latest high street banks to announce cuts to mortgage rates across their respective line of products.
Yesterday, Halifax confirmed the rate attached to many of the lender’s mortgage products has been cut by 0.19 per cent.
Similarly, Santander revealed it was rolling out interest rate reductions across its line of fixed rate mortgages as of today.
In recent weeks, other major high street lenders have rolled out similar changes to their product offering, including HSBC, Barclays and NatWest.
As it stands, Halifax is providing the lowest two-year fix rate mortgage to individuals purchasing a property with a 40 per cent deposit.
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This particular product has a rate of 4.63 per cent and comes with a £1,093 fee.
From today, Santander has cut the rate of selected residential fixed rates by between 0.02 per cent and 0.16 per cent for purchases.
It confirmed there have been no changes to its buy-to-let, large loan, product transfer mortgages or its residential tracker rates.
Lenders have raised mortgage rates in response to recent intervention from the Bank of England over the years.
The central bank’s Monetary Policy Committee (MPC) has raised the base rate to 5.25 per cent in its fight to bring down inflation.
Analysts are betting on a rate cut from the Bank within the next couple of months with many banks and building societies preparing for this.
Reacting to Santander’s latest rate cuts, brokers broke down the current state of the mortgage market in the UJ.
Speaking to Newspage, Yellow Brick Mortgages managing director Stephen Perkins said: “This move from Santander has the potential to ramp up the rate battle between the UK’s biggest lenders.
“More cuts are now likely ahead of the expected base rate reduction in August. Things are really hotting up now in the mortgage market.”
Justin Moy, managing director at EHF Mortgages added: “This is another small but important rate cut from Santander, keeping them within range of Barclays and NatWest who have already improved rates this week.
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Mortgage repayments have shot up for many borrowers in recent years GETTY
“While buyers won’t see a huge improvement in their monthly payments, all these little wins are adding up over time. The mortgage rate cut momentum is growing.”
Hannah Bashford, the director at Model Financial Solutions, highlighted how a potential change in Government is acting as a catalyst for these changes.
She explained: “Put your summer plans on hold, a rate war seems imminent.
“The lead-up to the election is bringing a wave of optimism and potentially marks the beginning of good news for the mortgage market, with the prospect of rate reductions throughout the summer.”