The number of mortgage deals available on the market is at its highest since 2007
Santander increasing mortgage rates while NatWest reduces(Image: PA)
Santander is increasing mortgage rates while NatWest is reducing its products in mixed news from high street lenders as brokers urged borrowers to lock in deals now while rates are at their lowest for three years.
The former lender announced a raft of small mortgage rate increases of up to 0.1% on fixed rate residential products.
While NatWest is doing similar in the opposite direction with reductions of up to 0.15% on two-year fixed rate remortgages and purchases.
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The news comes as Moneyfacts reveals the number of mortgage deals available on the market is at its highest since 2007.
Speaking to Newspage, Justin Moy, Managing Director at Chelmsford-based EHF Mortgages, urged borrowers to take deals now while they are low — rather than wait.
He added: “The changes announced by both lenders are slight and not going to cause anyone much financial distress, but it does send a signal to borrowers that mortgage rates may not fall every time there is a change – whether it’s the cost of funds on the money market, or just to manage application volumes.
“It’s important that borrowers don’t leave it too late to make a decision to progress with their application.
“Mortgage rates are at their lowest in three years, so take advantage now, as the waiting game could be expensive.”
Craig Fish, Director at London-based Lodestone Mortgages. said the bigger picture is that the cost of borrowing is mainly moving down.
He continued: “This really isn’t anything to worry about. These marginal tweaks simply highlight just how tight mortgage pricing is right now.
“Lenders are operating on wafer-thin margins and making very fine adjustments rather than big directional moves.
“It’s also a clear signal that, despite some of the noise in the media, not all mortgage rates are on a one-way path down. What we’re seeing is a highly competitive but cautious market, not a collapse that’s ‘gone flat’.
“The bigger picture matters more: borrowing costs are now at their cheapest in a couple of years, and affordability is close to its strongest level in around a decade.
“For buyers and movers, waiting in the hope of further rate falls could be a false economy, as rising house prices can easily outweigh a tiny reduction in mortgage rates.”