The battle for the most competitive mortgage rates is in full swing as major lenders like Santander and Coventry Building Society have recently announced significant rate cuts. These moves come as a response to a growing price war among leading lenders, including Nationwide, Virgin, and NatWest, all striving to provide the most attractive options for prospective homeowners and existing customers. Let’s explore the latest rate reductions from Santander and Coventry Building Society, shedding light on how these changes may benefit borrowers in the ever-evolving mortgage market.
Santander's Rate Cuts
Santander, a prominent player in the mortgage lending sector, has taken the plunge by reducing selected fixed rates for residential purchase. The reductions reach as high as 0.14 percentage points, a considerable drop that can translate into substantial savings for borrowers. This rate-cutting strategy applies to fee-free fixed rate purchase deals spanning two, three, and five years. Additionally, Santander has introduced enticing fixed rate deals for purchase at 60% loan-to-value (LTV), which now come with an extra perk of £500 cashback for first-time buyers.
Here's a break down some of Santander's new rates:
- Five-year fee-free fixed rate for home purchase: 5.61% (85% LTV)
- Five-year fee-free fixed rate for home purchase at 60% LTV: 5.52%
- Fee-free two-year fixed rates for purchase starting from: 6.19% (60% LTV)
- Two-year fixed rates for borrowers with a 10% deposit (90% LTV): 6.5%
These rate reductions by Santander undoubtedly make homeownership more accessible and affordable, particularly for those seeking competitive fixed-rate options.
Coventry Building Society Joins the Fray
Not to be outdone, Coventry Building Society, ranking as the eighth largest mortgage lender, is also slashing rates on various residential and buy-to-let fixed-rate deals, as well as selected tracker mortgage options. These changes will come into effect from Friday, September 15.
Coventry's rate cuts cover a wide spectrum, including:
- Reductions for residential remortgage and product transfer (rates for existing customers looking for a new deal) at LTVs ranging from 50% to 80%, including offset and interest-only mortgages.
- Lower tracker rate deals at 65% and 75% LTV.
- Reduced fixed rates for buy-to-let customers, whether they are new or existing clients.
Market Competition Benefits Borrowers
The swift response from both Nationwide and Coventry Building Society to revise their fixed-rate deals underscores the intense competition in the mortgage lending industry. This competitive environment is a boon for borrowers, as it encourages lenders to continually improve their offerings to attract and retain customers.
According to Chris Ridge at My Financial Pro, "Coventry has quickly revised its fixed rates after Nationwide building society gave notice of rate reductions recently. Both Nationwide and Coventry are leading the way in fixed rate pricing, so to see this quick announcement is encouraging and suggests strong competition – which is good for borrowers."
Conclusion
As Santander and Coventry Building Society embark on rate-cutting campaigns, borrowers have more reasons to be optimistic about securing a favourable mortgage deal. The ongoing price war among leading lenders is driving innovation and affordability in the mortgage market, ultimately putting homeownership within reach for more individuals and families. Be sure to keep a close eye on these developments if you're in the market for a mortgage, as attractive offers may continue to emerge in this fiercely competitive landscape
