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Santander latest major lender to announce cuts: "move has potential to ramp up the rate battle between the UK's biggest lenders"

ended 02. July 2024

Santander is the latest major lender to announce rate cuts, with selected residential fixed rates reducing by up to 0.16% for purchases on election day. Newspage asked brokers for their thoughts, below.

13 responses from the Newspage community

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Stephen Perkins
Managing Director at Yellow Brick Mortgages
This is Santander reacting to its competitors and joining the rate reduction party. The lender follows Halifax and NatWest who reduced their rates on Monday. This move from Santander has the potential to ramp up the rate battle between the UK's biggest lenders. More cuts are now likely ahead of the expected base rate reduction in August. Things are really hotting up now in the mortgage market.
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Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
At last some sunshine in an otherwise gloomy July. These cuts aren't breathtaking but the cumulative effect of lenders competing for market share is starting to show. Lenders in recent weeks have been the polar opposite of Gareth Southgate’s team: they are heading in the right direction and appear to have a plan.
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Andrew Montlake
Managing Director at Coreco
Another big lender has joined the rate cut brigade. Whatever happens in the General Election this week, borrowers look set to have more power in the months ahead. The pre-election slowdown has allowed lenders to clear any backlogs and they will be keen to make up for lost ground over the next few months. Whilst they will be constrained by swap rates refusing to fall due to the Bank of England's lethargy, there is nonetheless some room for manoeuvre and the summer rate wars start here.
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Simon Bridgland
Director at Charwin Private Clients
Twice in one week I can hear Shania Twain ringing in my ears: "That don't impress me much". Santander have quietly announced that, on election day when you wouldn't get as much as a single line in print unless it was about the election, they are releasing some abysmal rate reductions, which are only for borrowers buying a new home. Any poor soul wanting a remortgage or existing Santander borrowers in need of a new deal will just have to stay on the higher existing rates. To put it into context, from tomorrow you will be able to get a 3.69% 2-year fixed rate on a buy-to-let. Residential lenders need to jump to it and drop rates further.
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Justin Moy
Managing Director at EHF Mortgages
This is another small but important rate cut from Santander, keeping them within range of Barclays and NatWest who have already improved rates this week. There is nothing for those remortgaging, with the bank instead focusing on homebuyers. While buyers won't see a huge improvement in their monthly payments, all these little wins are adding up over time. The mortgage rate cut momentum is growing.
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Rohit Kohli
Director at The Mortgage Stop
Another major lender cutting rates will certainly give borrowers something to cheer about before they go and cast their votes on Thursday. If this trend continues whoever comes into power will not have a better opportunity to seize on these positive signals from lenders and should look to capitalise on the momentum to kick-start the housing market into recovery.
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Dariusz Karpowicz
Director at Albion Financial Advice
Another major lender reduces rates as Santander jumps on the rate-cutting bandwagon. Not a massive reduction, but definitely a step in the right direction. What will happen when we get the election results? Who knows but it’s sure to be eventful. In these uncertain times, every little helps, and it's encouraging to see lenders making moves that could ease the burden on borrowers, even if just a bit.
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Craig Fish
Director at Lodestone Mortgages
More fantastic news that yet another lender is reducing rates. This news has been long awaited and is well overdue. Bewildered borrowers can finally breath a sigh of relief, as reductions look set to continue and more lenders jump on the bandwagon. The only disappointment here is that these reducitons are only aimed at those purchasing and not those that need to remortgage.
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Ben Perks
Managing Director at Orchard Financial Advisers
Santander slashes rates and shows that they will not stagnate and be left behind. They may not be huge reductions, but every little helps and borrowers will be thankful.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
If the turnout on election day is lower than usual, it’s because prospective buyers are back on Rightmove as mortgage rates continue to tumble. There's a growing sense of confidence among buyers at present. It's a shame these cuts don't apply to product transfers as existing borrowers need lower rates as much as anyone else. Only last week the Bank of England was warning about the millions of people who are set to come off ultra-low fixed rates so any help from lenders for people already with mortgages would be equally welcome.
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Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
Santander has hopped on the rate reduction train, following cuts by Halifax and NatWest earlier this week. This strategic move positions Santander within range of competitors like Barclays and NatWest, signaling an intensifying rate battle among the UK's largest lenders. Although these cuts are small, they are significant for homebuyers, contributing to a growing momentum in mortgage rate reductions. This latest adjustment could prompt further rate cuts ahead of the anticipated base rate reduction in August, and really boost the mortgage market. While those remortgaging may not benefit, homebuyers are starting to see gradual improvements in their monthly payments.
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Graham Cox
Director at Bridging Hub
Santander become the latest mainstream lender to reduce rates, albeit by just 0.16%. All we need now is a base rate cut to light a fuse under this moribund housing market.
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Hannah Bashford
Director at Model Financial Solutions
Put your summer plans on hold, a rate war seems imminent! The lead-up to the Election is bringing a wave of optimism and potentially marks the beginning of good news for the mortgage market, with the prospect of rate reductions throughout the summer. The majority of major high street lenders have already reduced their rates, indicating a downward trend. Barring any significant surprises on Thursday, it's reasonable to anticipate a continued decline in rates.