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Barclays follows Santander and goes sub-4%: "Consumers are about to get sick of hearing the words rate war"

Journalist: Justin Moy, Contributing Editor

ended 12. February 2025

Barclays have followed Santander and gone sub-4%, while BM Solutions and Coventry have also announced cuts. Barclays has reserved its  cheapest deals for Barclays Premier Clients and those buying a Green Home (so EPC Rating of either A or B). Brokers welcomed the cuts, with one saying: “Consumers are about to get sick of hearing the words rate war.” But another warned that: “While it's encouraging to see lenders passing on lower swap rates, the most significant impact would come from more competitive high LTV deals that help first-time buyers get on the property ladder. Until we see movement in that space, many aspiring homeowners will continue to struggle with affordability.” Views below.

 

11 responses from the Newspage community

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Rohit KohliVerified
Director at The Mortgage Stop
The news of further mortgage rate cuts, including sub-4% deals from Barclays is undoubtedly welcome for the millions of borrowers coming off fixed rates this year. However, the focus on lower LTV customers means that the real affordability challenge—especially for first-time buyers—remains unaddressed. While it's encouraging to see lenders passing on lower swap rates, the most significant impact would come from more competitive high LTV deals that help first-time buyers get on the property ladder. Until we see movement in that space, many aspiring homeowners will continue to struggle with affordability.
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Craig FishVerified
Director at Lodestone Mortgages
Consumers are about to get sick of hearing the words rate war, but it certainly seems this is well and truly underway and something we will all hear more of. To see rates below 4% is a milestone, so let’s hope that SWAP rates continue their downward trend as this will lead to even lower rates by lenders. Consumers can take their home buying plans off ice as the mortgage market starts its big thaw.
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Daniel HobbsVerified
CEO at New Leaf Distribution
The Bank of England rate decision last week has triggered frenzied activity among lenders and swap rates are on a downward trend for now. The paralysis of the economy and the impact of the Budget yet to feed through in earnest suggests rates could go lower in the days ahead. January was a damp squib but February is shaping up to be a month of fireworks for borrowers and the broader property market.
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Justin MoyVerified
Managing Director at EHF Mortgages
Lenders are offering more credible rate cuts as competition warms up an otherwise chilly market so far this year. Barclays is joining Santander with sub-4% mortgage deals, and BM Solutions is putting pressure on other BTL lenders to lower rates for investors. Barclays is making it important to find your EPC rating, and to buy efficient homes to genuinely save money compared to normal products. That's the best incentive for owners to react positively to green strategies.
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Simon BridglandVerified
Broker at Charwin Private Clients
Barclays clearly did not want to be left out in the cold, and have issued their first sub-4% deal of the year with a 3.99% offering to Premier banking customers and those buying a green-labelled home. The deal does beat Santander’s own 3.99% offering by having a fee that is a mouthwatering £1,100 cheaper, you just have to be in the right customer segment to fit criteria, so it won’t work for much of the marketplace. A good headline grabber though.
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Jack TuttonVerified
Director at SJ Mortgages
Barclays are hot on Santander's tails with their new sub-4% product. The fact that they followed Santander's lead so quickly after their announcement yesterday will hopefully kickstart a competitive spring mortgage market. With so many people's low mortgage products ending this year, a highly competitive market will be welcome news and much needed.
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Ken JamesVerified
Director at Contractor Mortgage Services
We are starting to see a shift in rates begin. Whether this will be an all-out rate war is hard to say as lenders get to grips with their pricing modules ensuring that they can support the rate cuts. It's a hard balance to strike but it seems that Barclays and Santander have found a way to make sub-4% deals work in the residential market. The main negative for Barclays is that they are only giving this to their Premier clients, whilst Santander have no such restrictions so at the moment Santander could be taking the lion's share of these reductions from the market. Also good news for any buy to let and let to buy clients with reasonable reductions from BM solutions, given all the negative press surrounding Lloyds Banking Group they must be delighted to have something posiitve to announce.
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Stephen PerkinsVerified
Managing Director at Yellow Brick Mortgages
It took longer than expected after the Bank of England rate reduction and dovish commentary from Andrew Bailey for lenders to cut their rates. However, with Santander and Barclays now competing with headline fixed rates below 4%, the first volleys in a new rate war may be underway. This signals positive news and will give increased confidence to potential homebuyers and movers.
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Ben PerksVerified
Managing Director at Orchard Financial Advisers
It’s starting to heat up. If conditions keep improving as they have, the rate war will be on. Barclays bolster its proposition by reducing rates and going sub 4%. More to join them in the coming days, great news for borrowers.
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Kelsey PhillipsVerified
Head of Specialist Lending at Arose Finance
Momentum and optimism are building across our client base, and it’s exciting to see lenders beginning to mirror this sentiment. The UK property market was engulfed by significant uncertainty last year, but now confidence is returning and we’re seeing a greater appetite for funding solutions that will drive investment and growth.
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Iain SwattonVerified
Director at Exemplar Financial Services
Barclays and Coventry cutting rates, following Santander’s move yesterday, signals fierce competition among lenders. Barclays now offering a sub-4% fixed rate—just like Santander—will no doubt push others to follow. This is fantastic news for homebuyers and those remortgaging, and it suggests we could see further rate reductions in the coming weeks.