Two major banks have announced new cuts to mortgage rates as swap rates continue to improve. The changes in mortgage rates, which are set to benefit millions, have been described as a “move in the right direction” by brokers.
NatWest announced that rates have been cut by up to 0.2% across purchase, remortgage, green and Buy to Let (BTL) products. TSB also announced it will cut its fixed house purchase and remortgage rates by up to 0.1%. The news comes just a week after Santander reduced its first-time buyer fixed rate mortgages at 85%, 90% and 95% loan-to-value (LTV) by up to 0.32%.
Brokers suggest that rates could continue to fall and expect the Bank of England to cut its base rate further.
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management, said: “Mortgage rates continue to move in the right direction for borrowers as markets price in the likelihood of a reduction in the base rate.
“With unemployment rising and business confidence shot, it’s surely now a case of when the Bank of England acts, not if.
“Activity levels have really started to improve in February and March is shaping up to be a busy month as all the pent-up demand from the fourth quarter, which was delayed due to the Budget, feeds through.”
First-time buyers are particularly benefitting from the rate cuts, with experts noting that things are looking more positive across the housing market.
Michelle Lawson, director at Lawson Financial, believes more lenders will follow in cutting rates, leading to more opportunties for borrowers.
She said: “Further rate cuts from major lenders and the expansion of more low or no deposit borrowing options is starting to open a lot more doors for borrowers.
“We expect more lenders to follow suit as they eye up business and are boosted by falling swap rates, which are the key to mortgage pricing.”
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