UK MORTGAGE lenders are cutting fixed rates as expectations grow for the Bank of England to lower interest rates more than previously forecast due to global economic instability.
According to the BBC, the move follows former US president Donald Trump’s introduction of trade tariffs on imports from more than 60 countries, prompting fears of a downturn.
Coventry Building Society became the largest lender to reduce its two-year fixed rate to 3.89 per cent, effective until the end of October 2027.
The deal, available to borrowers with a 65 per cent loan-to-value, comes with a £999 fee.
“There is growing demand for shorter-term flexibility in an uncertain market,” said Jonathan Stinton, Coventry’s head of mortgage relations.
Moneyfacts data shows the average two-year fixed mortgage rate has dropped to 5.3 per cent, while the five-year average is now 5.15 per cent.
The BBC reported that Clydesdale Bank and Newcastle Building Society have also lowered their rates.
The Co-operative Bank will reduce fixed rates on some purchase mortgages by 0.14 percentage points on Thursday. TSB, Metro Bank, and Bank of Ireland have made similar moves this week.
Brokers expect more cuts, although major lenders including Halifax, Nationwide, HSBC, Santander, Lloyds, and Natwest have yet to announce changes.
An aerial view of the British Steel Scunthorpe site on September 13, 2024. (Photo: Getty Images)
