TSB continues rate war with further cuts

Ahead of the Bank of England rate decision at midday, TSB has made a selection of rate cuts, which brokers told Newspage is yet more proof of the growing rate war. 

The reductions will take effect from tomorrow, Friday 22nd September, and will see selected residential products reduced by up to 0.25%.

The new rates will be starting from 5.09%.

For borrowers with smaller deposits, all of TSB’s new house purchase products above 85% loan-to-value (LTV) will now also benefit from £500 cashback.

Darryl Dhoffer, founder of The Mortgage Expert, said: “When it comes to mortgage rate cuts, to borrow from Francis Bacon, only too much is enough.

“Reduced transaction volumes throughout the year are now causing many lenders to price more aggressively to secure market share.

“The fact that this happened ahead of the Bank of England interest rate decision says all you need to know about how desperate lenders are to lend. Another result for borrowers.”

His views were shared by Craig Fish, managing director at broker Lodestone.

He said: “The more the merrier, and this is likely to continue as we head into the festive season and witness a full-on rate war as lenders quickly try to fill their boots before the year is out.

“Lenders are desperate to lend, and borrowers are desperate for lower rates. This is all positive news that is well overdue.”

Lewis Shaw, founder of Mansfield-based Shaw Financial Services, was also encouraged by the timing: “Today is the day we find out about the Bank of England base rate decision, with many thinking it’s on a knife edge of a hold or an increase, so to see another high street lender reducing rates can only be a positive.

“It’s another sign of the growing rate war. Chances are we’ll see much more of this in the coming few weeks, and not before time, as consumers are worrying, especially with over half a million people set to move onto new rates before Christmas.

“This could be the present many have been hoping for.”

Jamie Lennox, director at Dimora Mortgages, concluded: “Week after week, we see the same emails from lenders announcing further rate reductions.

“This can only show the damage caused to the housing market by 14 consecutive base rate increases.

“Lenders are clearly chasing their tails for the rest of 2023 to reach lending targets to appease shareholders.

“Hopefully, positive commentary following today’s announcement will spark the rate war even further.”