Halifax is the latest lender to cut its rates, cutting first-time buyer and home operator fixed rates by up to 0.12% and fixed remortgage rates by up to 0.14% yesterday (Monday).
They were closely following Barclays and NatWest, which cut interest rates on Friday. Coventry Building Society and Gen H also cut rates in response to falling swap rates, which lenders have used to set fixed-rate mortgage rates.
Overall, mortgage rates are falling with the typical two-year fixed rate falling from 5.73% on Tuesday last week to 5.67% today, according to Moneyfacts.
Meanwhile, the average five-year mortgage rate fell from 5.66% last week to 5.62% today.
However, although interest rates are clearly moving in a downward direction, experts are warning borrowers considering waiting for further cuts that with so much volatility in the Middle East, anything can happen to interest rates.
Emma Jones, Managing Director at Runcorn-based Whenthebanksaysno.co.ukSpeaking to Newspage yesterday, he said: “Halifax announcing cuts on Friday and Gen H this morning will get June off to a good start but in the current turbulent economic environment lenders could price in the other direction very quickly.”
David Stirling, independent financial advisor at Belfast-based Mint Wealthtold Newspage borrowers shouldn’t “mistake momentum for a trend.”
He continued: “Swap rates remain volatile, and what is available on Monday may not be there by Friday.
“If you’re sitting on the sidelines waiting for interest rates to fall further, you could easily miss out. If the numbers stack up for you today, you should act. Shut them down, then watch the market.”
“Welcome news” for those who completed a fixed price deal
Despite these warnings, brokers have all welcomed the price cuts, saying those who take advantage will see the benefits.
Rachel Geddes, Director of Strategic Lender Relations at Mortgage Advice Bureau, said: “For those looking to remortgage, these rate cuts are another positive step and will be welcome news for borrowers who are nearing the end of a fixed deal.
“Although market conditions can change quickly, recent weeks have seen a clear trend for lenders to review and cut interest rates where possible.
“This makes access to expert mortgage advice more valuable than ever. With standards, rates and product availability varying widely between lenders, understanding the full range of options available can make a real difference to both affordability and long-term costs.”
