Selected first-time buyer and home mover fixed rates have also been reduced
Santander cuts rates by up to 0.3% amid war in the Middle East(Image: PA)
Santander is the first major lender to reduce selected fixed and tracker rates by up to 0.3% following the huge spike in rates due to the war in the Middle East.
For new applicants, Santander, which has branches across Birmingham and the West Midlands, will be reducing selected first-time buyer (FTB) and home mover fixed rates by up to 0.28%, while large loan home mover fixed rates will come down by up to 0.12%.
Rate reductions of up to 0.25% will also apply to selected buy-to-let purchase fixed rates.
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Selected tracker rates will also be reduced by up to 0.30% for FTBs and home movers, and up to 0.15% for home movers taking out large loans.
Meanwhile, across product transfers, all 80% and 85% loan-to-value (LTV) 1, 2, 3 and 5 year residential fixed rates will come down by up to 0.19%; and all 90% and above 90% LTV 1 and 2 year residential fixed rates will reduce by up to 0.25%.
Across buy-to-let (BTL), all 2 and 5 year fixed rates above 75% LTV will be reduced by 0.10%.
Santander says there are no changes to residential or BTL remortgage rates or tracker rates across its product transfer range.
The news comes as Moneyfacts revealed the average shelf-life of a mortgage is currently at a record low of eight days.
Speaking to Newspage, Craig Fish, Director at London-based Lodestone Mortgages, described the cuts as tactical rather than a turning point for rates as a whole.
He said: “Santander’s rate reductions are welcome, but let’s be clear, this is a business decision, not a market signal. They simply weren’t competitive enough to win new business at their previous rates, and this is them correcting that.
“Swap rates remain elevated and significantly higher than a year ago, so don’t hold your breath waiting for other lenders to follow. This isn’t a change in wind direction.
“That said, right now is genuinely a buyers’ market. Motivated sellers and thinner buyer pools means there are real bargains to be had for those who get off the fence and act. This is a good incentive to do exactly that.
“As for remortgage customers being left out, well lenders know those borrowers are already on their books and less likely to walk, so competitive pricing gets directed at new business.
“This is frustrating but a commercial reality.”