Coventry Building Society to cut fixed mortgage rates this week (Image: GETTY)
Coventry Building Society announced on Friday morning that it would be cutting interest rates across its fixed mortgage product range.
New and existing mortgage borrowers will benefit from fixed purchase fee rates as well as reductions on all fixed remortgage rates. Rates on two-, three- and five-year fixed purchase products will also fall, as will first-time buyer prices, offset, interest-only and equivalent interest-only rates.
New and existing buy-to-let and buy-to-let portfolio borrowers will see a reduction in all fixed rate products.
Brokers welcomed the news, especially as many two-year fixed interest rates expire in the fourth quarter.
Writing on the platform newspage.mediaPeter Stamford, director of the Alston-based company Prairie Mortgage He said: “Just as the festive season approaches, Coventry BS is cutting interest rates back to last summer’s levels.
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Brokers welcomed the timing as most two-year fixed interest rates are due to expire (Image: Getty)
“If you are one of the many rushing to sign a two-year deal before Christmas 2021, now is the time to call your advisor. Coventry is making a serious push for market share and you can benefit from that.”
Emma Jones, managing director whenthebanksaysno.co.ukIt could also benefit borrowers who are locked into two-year adjustments at the end of 2021, he said. He explained: “This is welcome news ahead of some of the Christmas maturities we are likely to see due to the Christmas completion rush in 2021 for those taking two-year fixed rates.
“If you have an ongoing application at Coventry BS, now is the time to speak to your advisor to see if any of these new rates are suitable for you.”
Steven Hargreaves, mortgage and preservation advisor Mortgage CompanyHe added: “There is more good news on the mortgage front, with Coventry doing its best to capture its share of the mortgage market in the fourth quarter.
“Let’s hope these cuts start to stimulate the housing market. “The current round of rate cuts means rates are similar to those available at the end of June, before rising sharply.”
Justin Moy, managing director of the Chelmsford-based company EHF MortgagesHe said further cuts in fixed interest rates showed “exactly how competitive the mortgage market has become”, with lenders cutting margins to increase their share of a small market.
He added: “Coventry BS continues to be both proactive and competitive with its range of mortgages and repricing across its full range, including offset agreements. Long may it continue.”
Average mortgage rates in the five-year fixed market (75 per cent Loan to Value) fell by 0.11 per cent last week, according to Uswitch’s mortgage expert Kellie Steed. Average two-year adjustments (90 percent LTV) fell 0.015 percent.
Meanwhile, average mortgage rates from the six biggest lenders, including Nationwide, Santander, HSBC, Halifax, Barclays Bank, NatWest and Lloyds Bank, have remained largely unchanged since last week.
According to Ms Steed, the average two-year fixed rate mortgage (75 per cent Loan to Value) currently stands at 5.69 per cent.
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The average five-year fixed-rate mortgage rate (75 percent LTV) remained unchanged at 5.14 percent.
The average two-year variable rate mortgage rates (75 percent LTV) of the six major banks is 5.84 percent.
A two-year fixed-rate mortgage with a 90 percent LTV currently averages 6.09 percent, while the average standard variable rate (SVR) currently stands at 7.99 percent.
Ms Steed commented: “Jeremy Hunt will deliver this year’s Autumn Statement on 22 November, with suggestions emerging that this could include some elements of much-needed first buyer support. First-time homebuyers haven’t had it easy over the past 18 months, with high rent and living costs limiting deposit savings, high house prices meaning larger deposits are needed and high interest rates making it harder to qualify for a large enough mortgage.
“That is why many people will be turning to the Government to provide support for those hoping to buy their first home. “There is some speculation as to what measures could be introduced, potentially with proposed improvements to the LISA scheme and an expansion of the mortgage guarantee scheme.”
LISA is an ISA that can be used by people under 40 to save for their first home or retirement; The government supplements personal savings up to 25 percent.
But Ms Steed noted: “Current restrictions mean they can only be used to buy properties worth up to £450,000, making it much less valuable for those in London and the South East. The average property in the capital, according to Zoopla The price currently stands at around £542,000.
“It has also been suggested that an additional ISA product for homeowners may be introduced. This could replace the help to buy scheme which is no longer available outside Wales; however details of any definitive plans are not currently available.
“There are also hints that the mortgage guarantee scheme, which was implemented during the peak of the epidemic, may be extended. This program was developed to encourage lenders to return to 95 percent mortgages at a time when employment uncertainty was high; The government has offered to cover a percentage of any losses that lenders may incur.
“However, it is unclear how much help this will realistically provide to potential homeowners, with the majority of lenders now offering 95 per cent mortgages off the scheme.”
