Santander, HSBC, Barclays, NatWest and Halifax cutting mortgage rates - best deals revealed

It will come as welcome news to mortgage borrowers who've been hammered over the past two years

Rate cuts have been announced by five major mortgage lenders on the high street. It comes as home loans interest rate continue to drop.

Over the past few months, mortgage rates have been coming down steadily. This has been sparked by hopes that interest rates will continue to be cut by the Bank of England, reports MirrorOnline.

In its August meeting, the Bank of England finally reduced its base rate from 5.25% to 5%. However at its last September meeting, instead of reducing rates again, it chose to hold them at this level.

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Andrew Bailey, the governor of the Bank of England, suggested in an updated this week that there could be “more aggressive” on the horizon if inflation remained in check. It will come as welcome news for mortgage brokers who, for over the past two years, have been hammered by higher costs.

Mortgage rates peaked in the UK in July 2023, with the average two-year fix reaching 6.86%, while the average five-year fix hit 6.35%. In an update today, financial comparison website Moneyfacts revealed the average two-year fix is now 5.38%, while the average five-year fix has fallen to 5.05%.

The absolute lowest two-year fix is 3.89% and the cheapest five-year fixed rate mortgage now sits at 3.69%. But what about for the main high street lenders? Barclays, HSBC, Halifax, Santander and NatWest have all confirmed changes to their mortgage rates this week.

Barclays is now offering a fee-free five-year fix with a rate of 3.92% for those with a 40% deposit, while the rate of its Premier two-year fixed deal has dropped to 3.96% - this comes with a £899 fee. HSBC has cut the rate of all its two-year and five-year fixed mortgages by up to 0.25 percentage points, with a rate of 3.83% on offer for those re-mortgaging with at least a 40% equity.

Halifax has also announced reductions of up to 0.24 percentage points, while Santander mortgages have dropped by 0.29 percentage points and NatWest has also confirmed cuts. If you're coming to the end of a fixed-rate mortgage, you can normally lock in a new deal at least three months in advance.

Do a search online to compare rates, then speak to a mortgage broker, as they will have access to deals that aren't always available on the open market. If you're on a tracker or standard variable rate (SVR) mortgage, you can normally switch to a new mortgage whenever you please. Follow the steps above to see what other deals are out there and if you could save money by going elsewhere.

The advantage of a fixed-rate mortgage is that you know how much you will pay each month, for a set period of time - however, you won't benefit from cheaper deals if mortgage rates continue to drop. The market is unpredictable, so no one can be sure how rates will fluctuate over the long-term - and a mortgage is a product that you'll have with you for many years.