A warning has been issued to anyone who holds an account with Santander, Nationwide, Lloyds or Barclays. Customers who currently have a mortgage, or are planning on taking out a mortgage, with any of the 'big four' banks are being urged to 'hold off' for the time being.
It has been reported that the banks are expected to follow in the footsteps of NatWest and HSBC and cut the rates of their mortgage deals in the coming days, making home ownership 'more affordable.' It comes as NatWest has cut its mortgage rates for the second time this week with reductions of up to 0.30 per cent for its new and existing customers, reports WalesOnline.
HSBC recently launched its first-ever 40-year mortgage which is the maximum term available and the longest the bank has ever offered. It said its long-term mortgage could help lower monthly repayments and is available to a variety of applicants, including first-time buyers.
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BirminghamLive reports that Stephen Perkins, of Yellow Brick Mortgages, said: “All these rate reductions are starting to feel like an avalanche. No doubt there will be more of these reductions over the week, as all lenders follow in a conga line.”
Owner of Shaw Financial Services, Lewis Shaw echoed: “I believe there is every chance we could see the remaining big four (Lloyds Banking Group, Barclays, Nationwide and Santander) come to the party this week, too. It would appear that lenders are struggling to get new business, and the rate tap is the only tool they can turn to.”
Nicholas Mendes, Mortgage Technical Manager at John Charcol, said HSBC had 'laid down the gauntlet and shown they mean business.' She added that it is their second rate reduction in a week 'along with criteria changes which extend terms to 40 years.'
Managing Director of EHF Mortgages, Justin Moy, had a similar view, saying: “I am sure others will follow the lead from HSBC and NatWest later this week.”
All of the top mortgage lenders in the UK have been cutting their rates for around six weeks now, reports the Manchester Evening News. It is hoped the move will get more people on the property ladder, according to Andrew Matson, Head of Mortgages at HSBC.
He said: “We know that home ownership is a key life ambition for many people, but affordability can be an issue. We are delighted to introduce our first-ever 40-year mortgage term to our customers. It underscores our commitment to supporting aspiring homeowners in their journey onto the housing ladder.
“By extending the mortgage term we aim to help make mortgages more manageable with lower monthly repayments and home ownership a reality for our customers.”
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