NatWest has reduced the rates of its fixed-rate mortgage deals. This decision comes amidst a growing price war among lenders, aiming to attract more customers with competitive pricing. NatWest’s rate cuts, effective from today, apply to various mortgage products, including those for residential home purchases and remortgages.
NatWest’s new strategy involves a reduction of up to 0.42 percentage points on selected rates. Notably, these changes follow similar actions taken earlier this week by other major players in the market, including First Direct, HSBC, TSB, Halifax, and Leeds Building Society. Despite these aggressive cuts, NatWest has kept its rates above the 4% mark, unlike HSBC and First Direct.
New Rates for Different Mortgage Types
The updated rates offered by NatWest through brokers are quite competitive. For residential remortgages, the two-year fixed rates start at 4.64% (for 60% Loan-to-Value or LTV) with a £1,495 fee. The equivalent five-year deals begin at 4.58%. For those looking to purchase homes, the rates are slightly lower, starting at 4.55% for two-year terms and 4.19% for five-year terms, each carrying the same fee of £1,495.
Besides the standard mortgage products, NatWest has also revised rates for buy-to-let borrowing, shared equity, help to buy schemes, and its product transfer range. This range is particularly for existing customers seeking new rates.
Other Lenders Follow Suit
Clydesdale Bank’s Competitive Rates
Clydesdale Bank, a part of Virgin Money, has also joined this rate-cutting trend, effective from today (5 January). Their offerings, available through brokers, include a two-year fixed rate for residential remortgage at 4.85% (65% LTV) with a £1,488 fee. A similar five-year deal is available at 4.60%. Rates for home purchase start from 4.61% for two years and 4.27% for five years.
MPowered Mortgages Steps In
Adding to the competition, MPowered Mortgages has reduced its fixed rates across its range, accessible through intermediaries. Their two-year fixed rates for residential remortgage start from 4.54%, with five-year deals beginning at 4.13%.
Rising Mortgage Approvals Indicate Market Resilience
According to the Bank of England’s latest Money and Credit Report, there has been a noticeable uptick in mortgage approvals. From October to November 2023, net mortgage approvals for house purchases increased from 47,900 to 50,100. Additionally, approvals for remortgaging have also seen a rise, from 24,000 in October to 27,000 in November. These figures suggest a resilient housing market as 2023 draws to a close, despite the ongoing pricing battles among lenders.