NatWest has today cut mortgage rates, offering a 3.89 per cent deal with a £1,495 fee.
Popular banks and building societies have announced a fresh round of mortgage rate reductions in a bid to remain competitive amongst first time buyers.
NatWest said the rate on its five year offer for borrowers with a minimum 40 per cent deposit would also be lowered by 14 basis points from 4.03 per cent to 3.89 per cent, with a fee of £1,495.
The lender will also be offering a market-beating 4.68 per cent rate fixed for five years to new customers who are buying a home with a 10 per cent deposit.
It comes with a £995 fee and is substantially lower than the competition.
The rates on most of the rest of its range are being lowered by 14 or 20 basis points.
Other lenders have also cut rates across different mortgage deals
PA
Other lenders have also cut rates across different mortgage deals.
Virgin Money is offering a five-year mortgage fix at a rate of 3.99 per cent, for those taking out 75 per cent LTV deals – which means people only need a deposit of 25 per cent.
The last time a rate of below four per cent was available for a loan with this deposit size and term length was February this year, according to Money facts.
Also, last week Barclays started offering a 3.83 per cent five-year fixed rate for home buyers with a 40 per cent deposit, which has a £899 product fee, but it is only for its premier banking customers.
HSBC’s best deal, at 3.92 per cent, is also available to premier banking customers and requires a deposit of 40 per cent and fee of £1,499.
Nationwide will be reducing rates by up to 0.2 percentage points across its two, three and five-year fixed rate products with the new rates effective from tomorrow, August 14.
Nationwide’s lowest mortgage rate now stands at 3.83 per cent, which is available to any new and existing customers who are looking to move home.
Most major lenders have reduced mortgage rates in recent weeks.
This is in part due to the Bank of England reducing the base rate from 5.25 per cent to five per cent at the start of August.
The cut brought some welcome relief to those on tracker mortgages who have seen their annual payments cut by an average of £340 as a result of the cut in rates.
Around 4,000 homeowners per day will potentially have a rate shock when their lower-rate deal ends if they do not fix before their current deal ends.
Tony Castle, managing director at PFG Mortgages com said: “The good news just keeps coming on the mortgage front. This is a great start to the week with NatWest announcing further rate reductions.
“Rates falling below four per cent and continuing to decrease is a huge and much needed relief to not only homeowners but also aspiring buyers.
“The feel good factor seems to be back. Clearly, this week’s inflation data will be closely monitored by lenders and could determine what happens to rates in the weeks ahead.”