Halifax is set to sharply cut rates on some of its fixed mortgage deals, potentially easing pressure on some homeowners.
The UK’s biggest mortgage lender will reduce rates by up to 0.71 percentage points from Friday, with a five-year fixed deal priced at 5.39% from 6.10%.
Other lenders such as HSBC, Nationwide and TSB have cut some rates.
Mortgage rates have risen as the Bank of England has pushed up interest rates in a bid to tame soaring prices.
Rates will be cut by Halifax across a range of products on offer, with smaller cuts on two-year fixed deals and some aimed at first-time buyers.
Other big mortgage lenders have been cutting rates this week, with some experts suggesting it could be a sign that high inflation – which measures the rate of price rises – could be starting to ease off.
While inflation has slowed, at 7.9% it remains nearly four times higher than the Bank of England’s 2% target.
The Bank of England lifted interest rates up for the 14th time in a row last week from 5% to 5.25%.
Higher interest rates mean people have to pay more for their mortgages, for example, which means they have less money to spend on other things.
Among the rate reductions, HSBC has cut some homebuyer, first-time buyer and re-mortgage rates on offer by up to 0.35 percentage points, as well as adding a £500 cashback incentive to some deals.
Nationwide is also reducing the rates on offer for those re-mortgaging by up to 0.35% across two, three and five-year fixed deals.
Aaron Strutt, from mortgage broker Trinity Financial, suggested: “More of the larger banks and building societies are lowering their rates, which is good news especially given the scale of rate increases we have seen in recent months.”
“It would not be a surprise if more of them improve their rates over the coming weeks,” he added.
“Lenders are starting to realise the market is slowing down, and they need to improve pricing to attract more borrowers.”
While rate cuts might be welcome, if people are re-mortgaging or are moving onto a variable rate mortgage, their monthly repayments are still likely to be much higher than their original rate.
Andrew Bailey, governor of the Bank of England, recently said that interest rates were not likely to fall until there is “solid evidence” that price rises are slowing.
It marked the first time the Bank acknowledged that interest rates would stay higher for longer.
Chancellor Jeremy Hunt recognised that rising interest rates would be “a worry for families with mortgages and for businesses with loans”, but reiterated the government’s aim to cut inflation.
New data released on Thursday from the Royal Institution of Chartered Surveyors suggested that the jump in mortgage rates was weighing on consumers.
Its survey suggested that British house prices had seen the most widespread falls since 2009 during July.
Denial of responsibility! SamacharCentrl is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.