High street lenders are moving in opposite directions on mortgage pricing, creating a mixed picture for UK borrowers. Santander has announced a series of small increases, while rival NatWest is trimming rates on selected products.
Lenders Take Divergent Paths
Santander is increasing rates on a range of its fixed-rate residential mortgages, with hikes of up to 0.1%. In contrast, NatWest is reducing rates by up to 0.15% on certain two-year fixed deals, available for both home purchases and remortgages.
The news arrives as financial data firm Moneyfacts reports a significant boost in product choice for consumers. The number of mortgage deals available across the market has now reached its highest level since 2007, offering borrowers more options than at any point in the last 19 years.
Brokers Urge Borrowers to Act
Mortgage experts are advising clients not to delay their decisions, despite the conflicting signals from lenders. Justin Moy, Managing Director at EHF Mortgages in Chelmsford, emphasised that current rates represent a major opportunity.
"Mortgage rates are at their lowest in three years, so take advantage now, as the waiting game could be expensive," he stated. Moy noted that while the latest changes from Santander and NatWest are slight, they signal that mortgage rates will not fall every single time market conditions shift.
"It's important that borrowers don't leave it too late to make a decision to progress with their application," he added.
A Market of 'Wafer-Thin' Margins
Craig Fish, Director at Lodestone Mortgages in London, provided context, suggesting the marginal tweaks reflect intense competition and caution among lenders.
"Lenders are operating on wafer-thin margins and making very fine adjustments rather than big directional moves," Fish explained. He stressed that the overall cost of borrowing is still near its most affordable point in around two years.
Fish also warned prospective buyers against holding out for further small rate reductions. "For buyers and movers, waiting in the hope of further rate falls could be a false economy, as rising house prices can easily outweigh a tiny reduction in mortgage rates," he concluded.
