Barclays has reduced rates for certain mortgage deals, starting from Tuesday 15th August.
As part of the changes announced, the lender introduced a reduction of 0.3% for product transfers and further advances for 2-year and 5-year fixed rates up to 85% loan-to-value (LTV).
With Barclays has now aligned with other leading lenders, with many having adjusted their prices last week, Newspage asked brokers if this move could potentially could trigger another wave of rate reductions.
Reaction:
Ben Tadd, director at Lucra Mortgages:
“The mini-rate war in the residential mortgage market appears to be continuing, with the main six lenders in the market having all now slashed their fixed rate offerings.
“This is now likely to force smaller lenders to follow suit and drop their prices to stay in touch with the competition.
“This week’s inflation data on Wednesday will be crucial to dictating lender pricing in the immediate future and, with further positive inflation numbers anticipated, the rate war is likely to continue apace.”
Riz Malik, founder and director at R3 Mortgages:
“We appear to be in the midst of a mortgage rate rollback.
“We were expecting Barclays to join the other main lenders and reprice last week but better late than never.
“Given the release of significant economic data this week, Barclays’ rate revision might prompt other lenders to reassess and possibly lower their rates further, especially if the market remains favourable.
“This is starting off to be another positive week for mortgage borrowers, even for those borrowing at higher LTVs.”
Lewis Shaw, owner and mortgage expert at Shaw Financial Services:
“After last week’s news of major lenders reducing rates, it was only a matter of time until Barclays joined the fray.
“Now that the big six are in the mix it’s time for the rest of the market to jump aboard the lowering rate train.
“Expect more cuts to come if the inflation data on Wednesday is positive and bring a much-needed boost to worried mortgage holders about to face remortgaging in the coming months.”
Justin Moy, managing director at EHF Mortgages:
“This is a belated but welcome message from one of the key high street lenders, with a number of mortgage rates reducing, especially for those borrowers with smaller deposits.
“Coupled with similar reductions from the Nottingham Building Society this afternoon, this will be a very interesting week to see if this reducing trend continues beyond the inflation figures announced.
“Many lenders may sit on their hands before they make any more changes, just for safety.”
Jamie Lennox, director at Dimora Mortgages:
“It’s great to see the last of the big 6 move their fixed rate pricing downwards, although it’s disappointing to see how slow they’ve been to react with these reductions versus other lenders.
“However, now Barclays have finally shown up to the party it can really get started with further reductions across the board if another set of positive inflation data is released this week.”
Craig Fish, director at Lodestone Mortgages & Protection:
“It’s good to see the last of the big six reduce their rates in alignment with the other lenders. But that is all this is. It is by no means a rate war, this is where the lender’s rates should have been.
“Having realised they aren’t writing enough business to survive, they had to adjust their rates accordingly.
“If we see some positive inflation data released this week, then I strongly suspect that we might get the first sniff of a rate war. The big question is who will be the first to jump.”
Ranald Mitchell, director at Charwin Private Clients:
“Who saw this coming? It looks more and more like the bigger lenders are fighting for market position, a sure sign that they are well off their respective lending targets.
“The question is, with the likelihood of further base rate increases, is this a short-term window of opportunity for expiring fixed rates to soften the payment shock they have steaming towards them?”
