Halifax brings momentum to mortgage rate cuts

Posted under General by Michael

The UK’s largest lender, Halifax, further accelerated fall of mortgage rates by announcing cuts in the cost of deals. This is the second move by the lender in recent weeks.  The two-year and five-year fixed rates were reduced by up to 15 basis points. The Bank of Scotland, BM Solutions and Intelligent Finance belonging to HBOS groups, also resorted to cuts on different rates including self certification and buy-to-let loans. The changes bring a sigh of relief to the borrowers who can expect further improvements in the rates in the coming months.

The past few weeks witnessed reduction in rates from Lloyds TSB, Abbey, and Woolwich. Nationwide reduced rates to the extent of 30 point basis. According to broker David Hollingworth, at London & Country Mortgages, for the first time in the past one year, lenders are trying to create more business rather than opting to pull away from the market. He is however unsure whether the trend will continue to improve further.

The downtrend in fixed mortgage rates was triggered by the rapid fall in the swap rates for short-term fixed lending in last few weeks. According to brokers, the initiative of number of banks to move rates downwards for attracting more customers is good news for homeowners.

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