A trio of major mortgage lenders all cut their headline fixed rates again as the cost of home loans falls to their lowest level since before Liz Truss’s mini-Budget.
TSB was first out of the blocks by slashing up to 0.25% off its two, three and five year deals for homeowners and first time buyers, with new rates starting tomorrow.
The move was rapidly followed by rivals Barclays and HSBC in a full scale price war that is starting to breathe life back into the property market.
The reductions come as the City wholesale market swap rates that set the price for fixed rate mortgages continue to drift downwards in anticipation of more interest rates cuts by the Bank of England following its 0.25% downward move earlier this month.
Barclays trimmed 0.15% off many of its deals, including a two year fixed rate deal for borrowers with only a 15% deposit. The rate came down from 5.22% to 5.07%.
HSBC said it will be making reductions to its two, three and five year fixed products on LTVs ranging from 60% to 90% from tomorrow, although it did not specify how big they would be.
In addition Virgin Money cut 0.15% off its buy to let mortgage rates.
Ben Perks, managing director at Orchard Financial Advisers, said: “Swap rates continue to trickle downward so hopefully more cuts are on the way as we head into the Bank Holiday weekend.”
Justin Moy, Managing Director at EHF Mortgages said: “Further cuts to mortgage rates will be welcome news for borrowers, as the market looks to encourage more activity for homebuyers and first-time buyers, improving affordability and keeping the property wheel spinning.
.Katy Eatenton, Mortgage & Protection Specialist at Lifetime Wealth Management said: “Lenders are definitely doing their best to make August one of the busiest yet.
“Three major lenders announcing more rate cuts is keeping the market moving in the right direction, even if another base rate card reduction is off the cards in September.”
Ranald Mitchell, Director at Charwin Mortgages said “With lenders battling it out, borrowers and the property market are set to benefit from this relentless momentum. The race is on, and it’s shaping up to be an exciting end to the year for anyone looking to secure a great mortgage deal.”
