Major lenders including NatWest, Nationwide and Coventry Building Society have cut interest rates on fixed mortgage deals as they bet on inflation dropping.
All six of the country’s largest lenders, including Barclays and Lloyds Banking Group, have slashed their rates in the past week, in the fourth week in a row that mortgage prices have dropped.
Lenders including Barclays and Yorkshire Building Society cut their rates by as much as 0.61 percentage points on residential fixed rate mortgages yesterday.
rates still remain far higher than they were in recent years, however, meaning those needing to remortgage face much higher costs.
(File Photo) NatWest was among money lenders to cut interest rates on fixed mortgage deals
Official inflation figures published this morning buoyed hopes that households will feel some reprieve from the pace of eye-watering price increases.
Inflation dropped to a 15-month low in June and is fell further to 6.8 per cent in July.
But the Bank of England is expected to keep increasing interest rates, after it hiked base rate to a 15-year high of 5.25 per cent earlier this month. This means mortgages are unlikely to keep falling every week.
Prime Minister Rishi Sunak said yesterday there was ‘light at the end of the tunnel’ in his plan to halve inflation and that bringing inflation down was the ‘best way’ to bring interest rates down.
There have been warnings of a slowdown in the housing market due to the cost of living crisis, causing providers to slash prices as competition for good deals hots up.
News of reductions will be welcomed by 1.3million borrowers facing the end of an existing fixed rate deal on their home this year, as they have been fearing a huge hike to their mortgage costs.
Check what a new deal would cost you based on your home’s value and loan size with our best mortgage rates calculator.
