High Street Lenders Slash Mortgage Rates
3 minute read
High street mortgage lenders have significantly slashed lending rates this September as Virgin Money lead the charge for cheaper mortgages with even longer fixed terms. From mmortgages with bad credit to buy to let products, rates for mortgages have been culled across the board, making finding finance for property more affordable.
HSBC, Metro Bank, Halifax, Virgin Money, Skipton Building Society, Barclays, Nationwide, Santander and Norwich & Peterborough Building Society have all given their lending rates a chop this autumn, with Virgin Money’s new 6 year fixed product standing out amongst the crowd. The cause? Well, it looks like a price war amongst the UK’s biggest lenders.
Mortgage price wars heat up
Earlier in the month rates looked to be on the rise, with significant interest rate hikes on the horizon. While these hikes are still likely in the not-so-distant future, high street providers have again dropped their rates below the 3% mark for those with 30% deposits in a bid to seduce borrowers with five year fixed rate plans.
At the start of September a borrower with a 10% deposit would have found that the average rate of lending on a five year fixed rate mortgage was 4.98%. Today that rate has fallen to 4.92% over the course of just a few days.
It’s all about the swap
Industry commentators are pointing to falling swap rates as a key factor behind all of this competitive price slashing. Swap rates are used by lenders to set their loan prices and, in recent months, these have been falling. Many lenders now seem to think that they are unlikely to rise before the end of the year, resulting in more optimistic lending.
Another factor could be the approach of 2015 and the desire to hit end-of-year lending targets. On top of all this, new lending regulations are becoming more familiar, which makes lenders more comfortable with the process and more willing to lend.
Time to buy?
If you’re looking for lower mortgage rates, this is one of the best moments of 2014 to jump in. While we’re unlikely to see rates as low as in 2013, competition between lenders is only likely to intensify in the coming month or two which is good news for prospective borrowers.
In a rapidly fluctuating market, it’s often tricky to know where and when you will find the best deal. When you’re seeking mortgages with bad credit, this can be even tougher. For more information and to speak to our specialist bad credit mortgage team, get in touch today on freephone: 0800 9777840.