Mortgage rates drop: Natwest cuts interest by up to 0.6%

More Lenders Lower Mortgage Rates: Natwest Cuts Interest by Up to 0.6% on Some Transactions as Borrowing Costs for Homeowners Continue to Fall

  • Natwest is now offering a 5-year fixed deal for 5.38% down from 5.98%
  • Lenders including HSBC and Virgin Money have also been cutting rates.
  • The cost of borrowing has fallen since Liz Truss stepped down and gilt yields have fallen

Natwest and Darlington Building Society are the latest lenders to update their mortgage rates, with Natwest cutting prices by as much as 0.6 percent.

Major lenders are starting to cut mortgage rates, after the mini-budget pushed them up and added hundreds of pounds to some homeowners’ bills.

Earlier in the week, HSBC and Virgin Money changed the price of products, lowering the cost of borrowing.

For existing customers, Natwest has reduced the price of its 25 percent deposit, five-year fixed rate agreement by 0.6 percent, from 5.98 percent to 5.38 percent.

Concerns: Rising borrowing costs have raised fears of a foreclosure crisis, as those with fixed-term agreements have to re-mortgage

The same product for borrowers with a 40 percent deposit has also been reduced by 0.6 percent, from 6.20 percent to 5.60 percent.

On a £200,000 mortgage, the rate reduction would save borrowers over 25 years £73 per month or £876 per year.

The bank has also lowered several of its rates on two-year fixed deals. For a 40 percent deposit deal, they fell 0.43 percent to 5.66 percent from 6.09 percent.

The drop means the product is now £53 cheaper per month or £636 less per year on a £200,000 mortgage taken out over 25 years.

Darlington Building Society has also re-entered the fixed rate market with products for new and existing customers.

The building society offers a five-year fixed rate of 6.09 per cent for those with 10 per cent deposits, costing £1,105 per month for a £170,000 mortgage.

Existing customers can get a two-year fixed rate of 6.04 per cent with a 40 per cent deposit, which costs £776.09 per month with a £120.00 mortgage.

Chris Brown, Director of Product and Marketing at Darlington Building Society, said: ‘The Darlington Building Society is redoubling its commitment to the mortgage market by reintroducing fixed rate mortgages, after remaining on the market with a range of variable rate options.

“We know that this is a difficult time for buyers right now, and we hope that bringing our fixed-rate mortgages back to the market provides peace of mind and additional options for those looking to buy their own home or re-mortgage with the Society.

“On top of this, all of our borrowers who apply for a mortgage continue to be considered by a person, not a computer.”

The average two-year fixed rate across all deposit sizes is now 6.48 percent, down from 6.65 percent last week, according to Moneyfacts.

The average for a five-year fix also fell to 6.34 percent from 6.43 percent in just a few days.

Earlier in the week, Accord confirmed that it was cutting 5 percent deposit product rates by as much as 0.52 percent, and 10 percent deposit product rates by as much as 0.53 percent.

The slightly higher deposit products of 15 percent and 25 percent will be reduced by as much as 0.35 percent.

The lender also launched a ten-year term product.

What to do if you need a mortgage

Borrowers who need to find a mortgage because their current fixed-rate agreement is coming to an end, or because they have agreed to purchase a home, have been urged to act but not panic..

Banks and building societies continue to lend and mortgages are still being offered and applications accepted.

However, rates are changing rapidly and there is no guarantee that the deals will last and not be replaced by mortgages that charge higher rates.

This is the best Money Mortgage Rate Calculator powered by L&C that can show you offers that match the value of your mortgage and property

What if I need to re-mortgage?

Borrowers should shop around and talk to a mortgage broker and be prepared to act to secure a rate.

Anyone with a fixed-rate agreement ending within the next six to nine months should consider how much it would cost to remortgage now and consider closing a new agreement.

Most mortgage deals allow fees to be added to the loan and are then only charged when you withdraw. By doing this, borrowers can lock in a rate without paying expensive setup fees.

What if I am buying a house?

Those with agreed home purchases should also aim to lock in rates as soon as possible, so they know exactly what their monthly payments will be.

Homebuyers should be careful not to overstretch themselves and be prepared for the possibility of house prices falling from their current high levels, due to higher mortgage rates limiting people’s borrowing capacity.

How to Compare Mortgage Costs

The best way to compare mortgage costs and find the deal that’s right for you is to talk to a good broker.

You can use our best mortgage rate calculator to display offers that match your home value, mortgage size, term, and fixed rate needs.

Keep in mind, however, that rates can change quickly, so the advice is if you need a mortgage, compare rates and then speak to a broker as soon as possible, so they can help you find the right mortgage for you. .

> Consult the best fixed-rate mortgages that you could apply for