Mortgage Rates Fall as Lenders Compete for Borrowers
Monday 3 March, 2025
The UK mortgage market is seeing growing competition, with lenders reducing rates in response to the Bank of England’s recent base rate cut. As mortgage rates continue to decline, borrowers have a prime opportunity to secure more favourable deals.
Industry specialists suggest that this trend is set to persist, making now an excellent time for both homeowners and buyers to review their mortgage options.
Lenders Lower Mortgage Rates Amidst Market Competition
Following the Bank of England’s recent interest rate reduction to 4.5%, many major lenders have reacted by cutting their mortgage rates. Both high-street banks and specialist lenders are actively competing, looking to attract new borrowers as housing market activity increases.
According to figures from Moneyfacts, the average five-year fixed mortgage rate has dropped to its lowest level since early 2023, with two-year fixed rates also showing a downward trend. Some lenders are even introducing incentives such as cashback offers and reduced arrangement fees to entice potential borrowers.
What This Means for Homeowners and Buyers
Falling mortgage rates bring positive news for those looking to remortgage, purchase a property, or step onto the housing ladder. Lower interest rates mean more manageable monthly payments, improving affordability at a time when house prices have remained relatively steady.
While rates are currently decreasing, experts caution that future economic developments could influence their movement. The Bank of England remains vigilant regarding further adjustments, as policymakers weigh inflation concerns against economic stability. However, with lenders actively competing, there is an opportunity for those considering a remortgage or new mortgage.
Why Now is the Right Time to Review Your Mortgage Options
With the property market gaining momentum and lenders continuing to adjust rates, now is an ideal moment to evaluate your mortgage choices. Whether you’re a first-time buyer, moving home, or seeking a remortgage, speaking to a mortgage adviser can help you navigate the evolving market.
As a professional mortgage broker, Thomas Oliver has access to a wide range of mortgage products from multiple lenders, ensuring you secure the right rates and terms for your individual financial circumstances.
Consulting one of our team of mortgage advisers can also help you understand the broader financial aspects of securing a mortgage. Our team has extensive knowledge of lender requirements, affordability assessments, and any potential hidden costs. This expertise can be invaluable in selecting the most suitable mortgage product tailored to your needs and long-term goals.
James Ashaye, Mortgage Adviser in Edmonton, North London, said:
“The UK mortgage market is evolving, with heightened competition among lenders leading to better deals for borrowers. While interest rates remain a key factor to monitor, the current lending environment offers a good opportunity to secure a more affordable mortgage. Seeking expert advice can help borrowers make well-informed decisions and take advantage of today’s mortgage market before conditions change again.”
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
Source: https://www.bbc.co.uk/news/live/cly5rm5d7pxt
Approved by The Openwork Partnership on 26/02/2025.
