NatWest is the latest major lender to lower mortgage rates

NatWest is the latest major lender to cut some of its fixed mortgage rates.

Starting tomorrow, NatWest will reduce its fixed rates by up to 0.65 percentage points on both two-year and five-year terms.

The changes affect mortgage deals for home movers, first-time buyers and those taking out a new mortgage with NatWest, suggesting that rates may have peaked again.

In addition, Virgin Money is also repricing a range of remortgage products – including an 80 percent loan-to-value deal at 5.6 percent.

Banks have unleashed a kind of mortgage price war in recent days that could bring much-needed relief to troubled homeowners.

Halifax, the country’s largest lender, announced this morning that it will cut the cost of its borrowings by up to 0.71 percentage point.

The move follows cuts announced this week by HSBC, TSB and Nationwide.

Nicholas Mendes, mortgage technical manager at John Charcol said: ‘NatWest is the latest lender to announce a fixed rate cut, another positive move in a week where we’ve seen other major lenders make similar moves.

It’s important not to get carried away and expect similar rates from earlier this year to come soon, but it’s nice and reassuring to see how lenders react to each other’s moves.

“For those currently on a mortgage application or approaching the end of their fixed rate, talking to a real estate agent now can certainly be financially beneficial.

Much now depends on inflation in July, which is expected on August 14. If inflation falls again and beyond forecast, we could continue this trend.

However, if inflation falls less than predicted, the reverse could happen.

Craig Fish, director at Lodenstone Mortgages & Protection, says: “These steps are a step in the right direction, towards where rates should have been, but the real interest rate war will begin when we see inflation data released next week. as long as it keeps going in the right direction.’

Adds Mendes, “Swap rates have held steady over the past few weeks, positive news on inflation data and no sudden post-MPC meeting shocks have given the lender confidence to slowly begin pricing fixed rates on a downward trajectory.

“We’re not quite out of the woods yet, as markets will eagerly await whether inflation has fallen further in next week’s ONS announcement.”

peaked? Average mortgage rates peaked at the end of July, but now lenders are cutting rates.

Looking ahead, most mortgage brokers are optimistic that the best rates will soon fall back below 5 percent.

Lewis Shaw, owner and mortgage expert at Shaw Financial Services says: ‘Get ready for some fixed rate handcuffs as mortgage lenders compete for market share.

If we see positive inflation numbers next Wednesday, expect more from this.

“I wouldn’t be surprised if rates are high 4s to low 5s by the end of the year.”

Nick Mendes of John Charcol adds: Fixed rates are on a downward trend, but it could be months before we start to see 2-year fixed rates below 5 percent. and lenders competing to bring in business again.

“It will be a few months before we see substantial reductions in fixed rate pricing, we should expect small reductions in the coming weeks before we see lenders competing with each other again.

Before the end of the month, we could see high street lenders pricing in low 5 percent or high 4 percent deal on the best five-year fixed rate deals. Unfortunately, I expect the majority of two-year fixed rates to be above 5 percent.

For anyone currently approaching the end of their deal, the advice is to lock in a rate now with a view to the fact that they can always change closer to the time.

Adds Mendes, “Most lenders will allow you to change or withdraw your application without penalty before it is finalized. existing deal is expiring then there are a few options available.

“You can either stay with the existing lender you applied to and move to a new fixed rate as part of the remortgage.

You can revisit the market to see if there have been any substantial changes, as you might look to withdraw the current application and resubmit to a new lender at a lower rate.

“Or you can look at options with the existing lender and make a product transfer instead if it turns out to be a more cost-effective option.”