Barclays has cut rates on a number of mortgages and brokers believe more lenders will follow in its footsteps and cut prices this week.
The bank announced this morning that it will reduce rates on some of its two- and five-year fixed rate deals for customers buying property. The changes will take effect from tomorrow (Tuesday 25 June).
It comes just after the The Bank of England maintained the base rate at 5.25% for the seventh time in a row.
But SWAP rates, which set prices for mortgage lenders, have also fallen recently, which likely had a bigger impact on Barclays’ decision.
Speaking to the Newspage agency, R3 Mortgages managing director Riz Malik said: “Barclays is the first lender of the week to improve select mortgage products, but I suspect it won’t be the last.
“Expect further cuts from other major and specialist lenders this week given improving market prices. The improvement in SWAPs is great news for borrowers.”
Another piece of good news for borrowers is the size of some of the cuts Barclays are also welcomed by real estate agents. As an example, the lender’s two-year fixed deal for those with a 90% loan-to-value (LTV), which currently stands at 5.76% with a £0 product fee, will be reduced to 5.48 tomorrow %.
Meanwhile, the two-year fixed rate for homebuyers who need to borrow at a 75% LTV will be reduced from 5.23% below the 5% threshold to 4.98%.
Michelle Lawson, director of Lawson Financial, also said via Newspage: “What a refreshing email to receive from Barclays on a summer’s day. These are real rate cuts, which will have significant benefits for borrowers and are not just a symbolic gesture.”