Santander Slashes Mortgage Rates: A Boon for Homeowners and First-Time Buyers

In a welcome move for homeowners and first-time buyers, Santander has announced a reduction in mortgage rates across its fixed-rate products. The changes, which come into effect today, are a positive development in a market that has seen soaring repayments over the last year due to high interest rates.

The Bank of England’s decision to hold the base rate at 5.25% last week has put pressure on mortgage holders, but economists are betting on a significant rate cut later in the year. This could be a game-changer for those looking to get on the property ladder.

Mortgage rates are on the move

Santander’s rate reductions are as follows:

• 60% LTV two-year fixed rate residential purchase mortgage with a £999 product fee is now priced at 4.20%, down from 4.25%.
• 75% LTV two-year fixed rate residential purchase mortgage with a £999 product fee is now priced at 4.30%, down from 4.35%.
• 90% LTV two-year fixed rate residential purchase mortgage with a £999 product fee is now priced at 4.89%, down from 4.94%.

The lender has also implemented rate reductions across its five-year fixed rate mortgages:

• 60% LTV five-year fixed rate residential purchase mortgage with a £999 purchase fee is now priced at 3.94%, down from 4.04%.
• 75% LTV five-year fixed rate residential purchase mortgage with a £999 purchase fee is now priced at 4.14%, down from 4.24%.
• 90% LTV five-year fixed rate residential purchase mortgage with no purchase fee is now priced at 4.64%, down from 4.84%.

Mortgage calculator

While the rate cuts are a positive development, experts are cautioning against rushing into the market too quickly. Michael Dinich, a personal finance expert at Wealth of Geeks, advises: “Your major indicator to consider acting on your house-buying plans is when the Bank of England does decide to lower the rates, which may happen as soon as this summer.”

“So it is wise to have a solid plan ready for when that day comes. A financial advisor or broker will be able to tell you exactly when the right time for you is, based on your personal circumstances.”

The Bank of England’s Monetary Policy Committee will next meet to discuss potential changes to interest rates on March 21, 2024.

Interest rates are on the move

In conclusion, Santander’s rate cuts are a welcome development in the mortgage market. However, it’s essential to approach the market with caution and have a solid plan in place before making any decisions.