1 July: NatWest’s Second Round Of Reductions In Less Than Fortnight
NatWest has cut selected fixed rate mortgage deals, available direct and through brokers, by up to 0.23 percentage points, effective from tomorrow (2 July), writes Jo Thornhill.
It follows cuts of up to 0.17 percentage points to fixed rate deals by the bank less than two weeks ago.
Among the newly-priced deals is a five-year fixed rate for purchase at 4.34%, or 4.77% over two years. For remortgage, five-year rates are available at 4.41%, or 4.81% over two years. These deals are all available at 60% loan to value and come with a £995 product fee.
NatWest has also cut rates on its product transfer deals (those for existing borrowers looking for a new rate). For these customers the bank is offering a five-year fixed rate at 4.46% or a two-year rate at 4.86%. Both deals are at 60% LTV and charge a £995 fee.
Selected buy-to-let (BTL) deals at NatWest have been cut by up to 0.18 percentage points. Deals for BTL remortgage start from 4.81% fixed over two years, or 4.66% fixed over five years. These deals are available at a 60% loan to value and come with a £3,499 fee. BTL deals with a lower product fee are available at higher rates.
Accord Mortgages, the specialist lending arm of Yorkshire building society, has also cut a range of fixed rate buy-to-let mortgage deals by up to 0.4 percentage points. The reductions will be effective from tomorrow when the details of costs will also be published on its website.
But mortgages are harder to come by, according to the latest Bank of England data. It showed that mortgage approvals (for home purchase) fell by 1.3%, from 60,800 in April to 60,000 in May. Approvals for remortgage (switching to a deal with a new lender) also dipped slightly from 29,900 to 29,600 over the same period.
Overall individual net borrowing of mortgage debt fell to £1.2 billion in May, down from £2.2 billion in April.
Alice Haine, personal finance analyst at online investment platform Bestinvest (part of Evelyn Partners), said: “Mortgage approvals – an indicator of future borrowing – dipped in May as lingering affordability concerns caused borrowers to approach the market with caution.
“Interest rates have remained on pause at a 16-year high of 5.25% since August last year, something also impacting net mortgage lending, which fell in May amid wavering consumer confidence.
She added: “Inflation may be easing, but persistently high borrowing costs are still making it hard for buyers to secure the homes they want. All eyes are on the next rate decision at the start of August when buyers and those looking to refinance are hoping for some respite.
“People may be seeing their wages increase in real terms, but robust pay growth is still no match for the hit from higher mortgage rates, something keeping house prices relatively stable for now.”
28 June: 400k Households To See 50% Increases
More than three million borrowers could face shock increases in their mortgage payments over the next two years, writes Jo Thornhill.
According to the latest Bank of England data, these households are currently paying mortgage rates at under 3% but are due to remortgage onto what will inevitably be more expensive deals between now and the end of 2026.
Around 400,000 households will see a significant increase in their monthly mortgage payments of 50% or more.
For the average mortgage holder rolling off a low fixed rate between now and the end of 2026, the Bank of England says the average jump in monthly repayments will be around £180 – a 28% rise on a typical £650 repayment.
Despite this, the Bank is confident the overall risks in the market are unchanged and that households have been broadly resilient in the face of rising rates.
It also pointed to the potential for lower mortgage rates in the coming months to ease pressure on borrowers, saying “market participants expect Bank Rate to start falling in the second half of 2024.”
Coventry building society has followed other lenders in cutting selected fixed rate mortgage deals for residential borrowers by up to 0.21 percentage points.
HSBC, Barclays, NatWest and Skipton building society have all trimmed their fixed rates down in recent days.
Coventry has also cut selected buy-to-let borrowing rates by up to 0.15 percentage points.
The mutual lender is offering a two-year fixed-rate deal for first-time buyers with a 15% cash deposit (85% loan to value) at 5.34%. There is no fee and the deal pays £500 cashback on completion.
Five-year fixed rates for remortgage now start from 4.43% (65% LTV) with a £999 product fee. Equivalent two-year remortgage deals start from 4.86%.
For buy-to-let remortgage, Coventry has two-year fixed rates from 5.43% (65% LTV) with a £1,999 fee, or equivalent five-year rates from 4.87%.
Contact one of our highly experienced mortgage advisors today on 0121 500 6316 to discuss your mortgage needs.
