Major lenders cut mortgage rates in ‘welcome boost’ for market

Some major mortgage lenders have cut their rates in a move that may help borrowers searching for a new deal.

HSBC UK reduced more than 140 mortgage rates on Friday, following a review of its deals.

Barclays has also reduced rates on a selection of products, including loans for home buyers and homeowners looking to remortgage, while TSB also made rate cuts on Friday.

HSBC said new business residential rates have been cut by up to 0.18 percentage points, and for homeowners who already have a mortgage with the bank and are looking to get a new fixed deal, rates have been cut by up to 0.11 percentage points.

An HSBC UK spokesperson said: “There are a number of factors that are taken into account when setting mortgage rates, and following a review, we are reducing over 140 mortgage rates by up to 0.18 (percentage points). We continue to keep our rates under review.”

HSBC’s new deals include a two-year mortgage for home buyers with a 10% deposit and no fee with a rate of 5.57%, reduced by 0.11 percentage points.

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The reduced price deals include offers for home buyers (PA)

The Barclays range now includes a five-year fixed-rate for home buyers at 4.44%, down from 4.73% previously, for people with a 25% deposit. The deal has a product fee of £899.

TSB has reduced some first-time buyer and home mover rates by up to 0.10 percentage points. Some remortgage rates have also been reduced by 0.10 percentage points.

Despite the cuts, financial information website Moneyfacts found some average fixed mortgage rates on offer edged up on Friday.

The average two-year fixed homeowner mortgage rate on Friday morning was 5.93%, up from an average rate of 5.92% on Thursday.

The average five-year fixed residential mortgage rate on Friday was 5.50%, up from an average rate of 5.49% on Thursday.

The choice of mortgages increased on Friday, according to Moneyfacts, with 6,637 homeowner products available, up from 6,521 on Thursday.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “This latest round of mortgage rate reductions from some big lenders is great news for borrowers.

“They come on the back of a decline in swap rates, which underpin the pricing of fixed-rate mortgages, over the past week.

“These cuts should give other lenders confidence to make similar reductions, which will stimulate activity and provide a welcome boost for the market.”