Mortgage rates slashed as lenders fight for borrowers
Barclays and TSB are the latest lenders to take an axe to mortgage rates, as competition for borrowers ramps up.
Both banks have reduced rates on two and five-year fixed-rates, including purchase and remortgage.
Barclays now offers a two-year fix at 1.33% and 60% loan to value (LTV), while TSB has reduced five-year remortgage rates by up to 0.2% on deals up to 90% LTV.
Accord also snipped rates this week by up to 0.35% on two-year deals, while Santander, Skipton and Leek Building Society are among the other lenders to have announced cuts.
Roland McCormack, TSB’s mortgage distribution director, said: “We always want our customers to borrow well and these rate reductions are good news for people who are buying their own home, or want to get a better mortgage deal with TSB.”
The average two-year fixed-rate has slipped to 2.34% from 2.35% over the past month, according to Moneyfacts data.
Providers are battling to entice new borrowers through the door, as appetite to lend outpaces demand, according to experts.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Lenders remain keen to lend and there is more money available than people ready to borrow it, which will keep mortgage rates low at least for now.”
It comes as data from UK Finance showed that mortgage approvals in December has fallen from the same period in 2016.
Earlier this month, David Hollingworth from broker London & Country predicted that many lenders could offer loss-leading deals in order to maintain market share in 2018.