Lenders Navigate Rate Plateau: Significant Cuts Unveiled by Virgin Money and Others

INTEREST RATE LANDSCAPE SHIFTS: SANTANDER AND CO-OPERATIVE BANK SLASH FIXED RATES FOLLOWING NATIONWIDE’S LEAD



On December 8th, Santander followed Nationwide’s initiative by reducing fixed rates for both residential and buy-to-let borrowers. Jo Thornhill reports that Santander has implemented cuts of up to
0.32 percentage points on these rates, applicable to both purchase and remortgage deals and accessible to both new and existing customers.

 

Among the new offerings, Santander presents a five-year fixed rate for home purchases at 4.39%, featuring a £999 fee. This deal is open to borrowers with a minimum 40% deposit.
Although competitive, Nationwide’s five-year fix takes the lead at 4.29% for purchases.


Santander’s reduced rates extend to remortgage customers, offering five-year fixed rates from 4.71%, three-year rates from 4.96%, and two-year rates from 4.92%, all carrying a £999 fee.
For buy-to-let borrowers seeking standard remortgage options, rates start at 4.71% for a five-year fix and 5.17% for a two-year fix with a 60% Loan to Value (LTV), accompanied by a £1,749 fee.

 

Co-operative Bank for Intermediaries (formerly Platform) has joined the trend by cutting rates on residential and buy-to-let deals for new and existing customers, reducing them by up to 0.45 percentage points.
Notable among its offerings is a five-year fixed rate for residential remortgage (60% LTV) at 4.68%, requiring a £1,999 fee. Equivalent two-year rates start from 4.87%.

 

Halifax for Intermediaries also adjusted its fixed rates, unveiling a five-year fix for home purchases at 4.37% with a £999 fee (60% LTV). For remortgage options, two-year fixed rates start from 5.25%,
while three-year and five-year deals are available from 4.97%, all at a 60% LTV and accompanied by a £999 fee. This series of rate cuts arrives less than a week before the upcoming Bank of England
meeting on December 14th, where decisions regarding the current 5.25% interest rates will be made.





Lenders React to Anticipated Rate Plateau with Significant Rate Cuts

 

In response to the widely expected stabilisation of interest rates, lenders are making strategic moves to reduce fixed rates for new and existing customers. Virgin Money, along with several other institutions,
is leading the charge with rate cuts of up to 0.36 percentage points. The article provides a comprehensive overview of the latest developments in the lending market.

 

Amid growing confidence that the interest rate cycle has peaked, lenders are taking proactive steps to adjust their offerings. Virgin Money is spearheading this effort, announcing substantial rate reductions
for both new and existing customers, effective from December 14. Smaller lenders are following suit, aligning with the prevailing expectation that the Bank of England's Monetary Policy Committee will maintain
the Bank Rate at 5.25% in its upcoming and final 2023 meeting.


Virgin Money's rate adjustments include a market-leading two-year fixed rate for residential remortgage at 4.59%, available through brokers. However, this attractive rate requires a minimum of 40% equity in the
property and entails a 1% arrangement fee. An equivalent deal with a 70% loan-to-value will be reduced to 4.69%. Buy-to-let rates have also seen reductions, with Virgin offering a five-year fixed rate for buy-to-let
remortgage at 4.74% (60% LTV) with a 1% fee, and a five-year fixed rate for remortgage at 4.59% (60% LTV) with a £2,195 fee.

 

HSBC is set to join the rate adjustment trend on December 14, revealing reductions in selected product transfer deals for its existing residential and buy-to-let customers. Other lenders making noteworthy rate
cuts include the Family Building Society, MPowered Mortgages, and Generation Home (Gen H). The Family Building Society has reduced fixed rates for residential and buy-to-let mortgage deals by up to 0.55
percentage points. MPowered Mortgages has cut selected residential fixed rates by up to 0.3 percentage points, offering a range of five-year fixed rates starting from 4.84% (60% LTV). Gen H has implemented rate
cuts across its entire range by up to 0.25 percentage points.
 

These rate adjustments reflect a dynamic landscape as lenders navigate the shifting economic climate, offering borrowers new opportunities to secure more favourable terms.