Fixed-rate mortgages priced below 4% are making a comeback for homebuyers thanks to recent rate cuts by lenders like Nationwide Building Society. The Society announced on Wednesday that it would be reducing rates by up to 0.25 percentage points on its two-, three-, and five-year fixed mortgage products, offering a five-year fixed deal priced at 3.99% for new customers buying a home with up to 60% loan-to-value.
This move marks the first time since February that a five-year fixed-rate deal below 4% has been available. Other lenders like HSBC and Halifax have also been lowering their fixed rates recently, prompting some brokers to suggest a potential “summer of savings” for homebuyers and homeowners looking to remortgage.
Nicholas Mendes, a mortgage technical manager at John Charcol, praised the rate decrease by Nationwide, calling it “fantastic news for borrowers” and a positive shift in the mortgage market after months of rising rates. He noted that while the 3.99% rate is for house purchases only, other lenders may follow suit to remain competitive.
Emma Jones, managing director at When The Bank Says No, sees the rate cuts as a response to potential Bank of England base rate cuts in August, predicting that rates could continue to drop. Nationwide’s director of home, Henry Jordan, highlighted the Society’s competitive positioning in the market with these latest rate cuts.
Overall, the return of fixed-rate mortgages below 4% signals a positive trend for homebuyers and homeowners looking to secure lower mortgage costs, potentially leading to further rate drops in the near future.
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