After weeks of lenders increasing rates on selected mortgage products, this week saw some lenders bring rates down – albeit modestly.
As Moneyfacts finance expert Rachel Springall points out there were around a dozen lenders making fixed rate reductions this week, which outweighed the number of lenders increasing rates, a clear contrast to recent weeks.
“One area of the mortgage market to receive attention was on three-year fixed mortgages, as a few competitive packages were revealed, such as those from MPowered Mortgages, TSB and The-Co-operative Bank.
“These deals may well appeal to borrowers who want a deal a little longer than a two-year, but do not wish to lock themselves into a longer-term fixed mortgage”.
There were also some five-year fixed first time-buyer deals enhanced by Yorkshire Building Society today, which now offer a £2,000 cashback incentive.
Springall continues: “Some rate rises were still seen this week, such as with Santander increasing selected fixed rates by up to 0.36%, but there were also a few deals withdrawn and replaced for borrowers to keep in mind, such as the temporarily withdrawal of the range by Scottish Building Society”.
A few more lenders have moved to increase their standard variable rates this week, such as NatWest and RBS which increased by 0.25%, Dudley Building Society by 0.40% and Pepper Money by 0.50%.
Building societies reducing rates on selected fixed rate products include Yorkshire BS (0.30%); TSB (0.55%) and Coventry (0.54%).
“It is positive to see several lenders making fixed rate reductions this week, and this may well continue into next week. However, we do have another Bank of England base rate decision looming, so all eyes will be on the outcome and its potential impact on the mortgage market,” Springall says.
“Those borrowers who are still tied into a low fixed rate mortgage would be wise to overpay where they can, but for those coming off a deal its vital they speak to their lender and seek independent advice if they are struggling to make repayments.”