A cut in mortgage rates by Barclays could be the start of a “mini price war”, according to brokers.
This week (August 20) Barclays is set to cut rates to offer better deals for those with large deposits, dropping one rate from 4 per cent to 3.79 per cent.
Justin Moy, Managing Director at Chelmsford-based EHF Mortgages, called it good news for borrowers.
He added: “This could well be the start of a mini-price war. In reality, I suspect lenders will just wait a couple more weeks until the kids are back at school, and we all look at our credit card statements, reminiscing about the holiday we may need to refinance soon.”
Ranald Mitchell, director at Norwich-based Charwin Mortgages, was also confident the news would result in more competition in the mortgage market.
“Barclays cutting rates again shows the mortgage market is in full price war mode,” said Mitchell.
“Competition is heating up fast, and that’s great news for buyers and those looking to remortgage.”
Pete Mugleston, managing director at Derby-based onlinemortgageadvisor.co.uk, now expects other banks to lower their rates too.
He said: “Borrowers who held out to see if the Bank of England would cut rates have been rewarded.
“Barclays has moved quickly with lower rates, and when a big lender makes changes like this it often sets the tone for the rest of the market.
“In such a competitive environment, it’s likely we’ll see other banks follow suit, which is good news for anyone buying or remortgaging right now.”
With thanks to the Newspage community for sharing their views with FT Adviser.
tara.o’connor@ft.com
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