Barclays to cut mortgage rates from Wednesday in "bold move"

Barclays PLC will cut rates on selected mortgage products by up to 0.20 percentage points, effective Wednesday, following a period of rate hikes by other lenders.

Barclays to cut mortgage rates from Wednesday in "bold move"

The London-based bank said the decision was driven by a volatile period in swap markets, which lenders use to price mortgages. Mark Arnold, head of mortgages at Barclays, noted that the bank is seizing the opportunity to lower core mortgage rates as swap market conditions improve. Among the changes is a remortgage deal dropping from 4.5% to 4.3%, aimed at borrowers with 25% equity and a £999 fee. In recent weeks, major lenders have raised mortgage rates due to swap market fluctuations. The Bank of England recently reduced the base interest rate to 4.75%, though experts expect further rate cuts to be gradual.

Experts praised the bank

Nicholas Mendes, a mortgage expert at John Charcol, praised Barclays for quickly adjusting to improving market conditions, calling it a positive sign for borrowers. He highlighted reductions like a two-year fixed mortgage at 90% loan-to-value, which dropped from 5.49% to 5.39%. Despite being modest, these changes offer some relief to borrowers, especially after recent rate increases. According to Moneyfacts, the average two-year fixed mortgage rate is now 5.53%, slightly down from 5.54%, while the five-year fixed rate remains at 5.28%.