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Mini price war among lenders sparks under-4% mortgage deals

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6 months ago

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Mini price war among lenders sparks under-4% mortgage deals

Almost all major lenders are now offering under-4% deals this week, giving some respite for borrowers in an apparent response to the financial turmoil sparked by the US trade tariffs that changed expectations on UK interest rates and sparked a mini price war among mortgage providers.

The average rate for a two-year fixed mortgage stands at 5.06%, while five-year fixed deals average 5.31%, according to data from Uswitch.

The Bank of England (BoE) held its interest rate at 4.5% last month after warning that global economic uncertainty has “intensified”. This is the lowest level for rates in more than 18 months, following a reduction from 4.75% in February, the third such cut since August 2024.

Financial markets and economists predict that the Bank of England will reduce borrowing costs more than expected this year to avoid a downturn.

The primary inflation measure, the Consumer Price Index (CPI), stood at 2.6% in the 12 months to March 2025, a slight decrease from the previous month. That means that prices have been rising at the slowest pace since December and are closer to the BoE’s 2% target.

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Most economists are predicting that the main borrowing rate will be cut on 8 May from its current 4.5% to 4.25%.

This week, NatWest (NWG.L) has pushed well into under-4% territory, with offers starting at 3.88%, while Barclays has reduced selected fixed rates and has broadened its range of deals at sub-4%. HSBC (HSBA.L) has also moved to offer some under-4% deals.

Read more: 5 vital but difficult questions to ask family members

Mark Harris, chief executive at mortgage broker SPF Private Clients, said: “NatWest’s launch of a market-leading five-year fix at 3.88%, along with a joint borrower sole proprietor mortgage for the first time and other enhanced affordability measures for all customers, is part of a growing trend among lenders keen to do more business.

“Falling fixed-rate mortgages and reversion rates for borrowers coming to the end of their current deal points to a lower rate environment. The easing of the cost-of-living crisis and inflation is playing a part, along with the Financial Conduct Authority clarifying its stance on affordability stress rates.”

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Outside the major lenders, Clydesdale Bank is also set to reduce selected residential mortgage rates by up to 0.15%, including two- and five-year fixes for loans between 65% and 75% LTV.

MPowered Mortgages has reduced its three-year fixed remortgage rates, now starting from 3.98% for customers with a 40% deposit paying a £999 fee, or 4.27% with no fee.

April Mortgages has increased its lending income multiple to seven times income for borrowers with a minimum income (single person or household income) of £50,000 taking a 10- or 15-year fixed rate deal.

HSBC (HSBA.L) has a 3.93% rate for a five-year deal, lower than the previous 4.12%. For those with a Premier Standard account with the lender, this rate is 3.88%.

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Looking at the two-year options, the lowest rate is 3.91% with a £999 fee, also lower than the previous 4.10%.

Both cases assume a 60% loan-to-value (LTV) mortgage, meaning buyers need to have at least 40% for a deposit.

HSBC offers 95% LTV deals, meaning you only need to save for a 5% deposit. However, the rates are much higher, with a two-year fix coming in at 5.19% or 4.94% for a five-year fix.

This is because their financial situation and deposit size determine the rate someone can get. The larger the deposit, the lower the LTV, allowing buyers to access better deals because lenders consider them less risky.

NatWest (NWG.L) has a five-year deal coming in at 3.88% with a £1,495 fee, lower than the previous 4.13%.

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The cheapest two-year fix deal is 3.88%, also lower than the previous 3.94%. In both cases, you’ll need at least a 40% deposit to qualify for the rates.

At Santander (BNC.L), a five-year fix is 4.16%, unchanged from the previous week. It has a £999 fee, assuming a 40% deposit.

For a two-year deal, customers can also secure a 4.01% offer, with the same £999 fee, which is also unchanged..

Read more: Bank of England poised to cut interest rates in May

Santander has also introduced mortgage products tailored to first-time buyers with large loans. These feature two- and five-year fixed-rate deals at 60% LTV, albeit with a higher £1,999 product fee.

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Barclays (BARC.L) was the first among major lenders to bring back under-4% deals and has now cut rates further with a five-year fix at the lender now at 3.923%, lower than the previous 3.99%. For “premier” clients, this rate drops to 3.92%.

The lowest you can get for two-year mortgage deals is 3.92%, also lower than last week’s 3.99%.

“After being the first major lender to go sub-4% in April, we’ve brought an additional six products under 4%, including for existing mortgage customers,” said Benjamin Pfeffer, vice president of external communications at Barclays UK. “Our biggest single drop will be 33 basis points, on a remortgage two-year fixed 75%, £999 product fee.”

Barclays has launched a mortgage proposition to help new and existing customers access larger loans when purchasing a home. The initiative, known as Mortgage Boost, enables family members or friends to effectively “boost” the amount that can be borrowed toward a property without needing to lend or gift money directly or provide a larger deposit.

Under the scheme, a borrower’s eligibility for a mortgage can increase significantly by including a family member or friend on the application. For example, an individual with a £37,500 annual income and a £30,000 deposit might traditionally be able to borrow up to £168,375, enabling them to purchase a home priced at around £198,375.

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However, with Mortgage Boost, the total borrowing potential can rise substantially if a second person — such as a parent — joins the application. In this case, if the second applicant also earns £37,500 a year, the combined income could push the borrowing limit to £270,000, enabling the buyer to afford a home worth up to £300,000.

Nationwide (NBS.L) appears to have moved the market with increases this week. The lender offers a five-year fix at 4.34%, with a £999 fee and a 40% deposit. This is higher than the previous 4.14%.

Nationwide offers a two-year fixed rate for home purchase at 4.14% with a £999 fee — also for borrowers with a 40% deposit. This is also higher than the previous 4.09%.

Read more: Best credit card deals of the week

The lender has announced it is changing the eligibility criteria for its mortgage scheme, which allows people to borrow up to six times their income.

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The minimum income required to take out a Helping Hand mortgage has been reduced to £35,000 — meaning more people will be eligible for the scheme. The minimum income requirement for joint applications will remain at £55,000.

Helping Hand mortgages enable people to borrow up to six times their income, meaning potential homeowners can borrow 33% more compared to Nationwide’s standard lending at 4.5 times income.

Halifax, the UK’s biggest mortgage lender, offers a five-year rate of 4.1% (also 60% LTV), untouched from the previous week.

The lender, owned by Lloyds (LLOY.L), offers a two-year fixed rate deal at 3.94%, with a £999 fee for first-time buyers, which is also unchanged.

It also offers a 10-year deal with a mortgage rate of 4.78%.

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Read more: UK house prices fall at fastest rate in two years after stamp duty changes

The lender has enhanced its five-year fixed mortgage products by increasing borrowing capacity. This improvement allows borrowers to access up to £38,000 more, enabling them to secure larger mortgages based on individual incomes.

Rachel Springall, finance expert at Moneyfacts, said: “The flourishing choice of low-deposit mortgages will no doubt be welcomed by borrowers who are either looking to remortgage or are a first-time buyer.

“The government has been clear that it wants lenders to do more to boost UK growth, and so a rise in product availability for aspiring homeowners is a healthy step in the right direction.”

Amid this mini price war between mortgage providers,, prospective homeowners have some better options. NatWest’s (NWG.L) 3.88% is currently the cheapest deal for both five-year and two-year fixes among the top banks, though both require a 40% deposit.

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The average UK house price is £366,189, so a 40% deposit equates to about £147,000.

A growing number of homeowners in the UK are opting for 35-year or longer mortgage terms, with a significant rise in older borrowers stretching their repayment periods well into their 70s.

Read more: Food prices rise as wage bills weigh on supermarket bottom lines

Lender April Mortgages offers buyers the chance to borrow up to six times their income on loans fixed for five to 15 years, from a deposit of 5%. Both buying alone and those buying with others can apply for the mortgage.

As part of the independent Dutch asset manager DMFCO, the company offers interest rates starting at 5.20% and an application fee of £195.

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Skipton Building Society has also said it would allow first-time buyers to borrow up to 5.5 times their income to help more borrowers get on the housing ladder.

Leeds Building Society is increasing the maximum amount that first-time buyers can potentially borrow as a multiple of their earnings with the launch of a new mortgage range. Aspiring homeowners with a minimum household income of £40,000 may now be able to borrow up to 5.5 times their earnings.

Mortgage holders and borrowers have faced record-high repayments in recent years, as the Bank of England’s base rate has been passed on by banks and building societies.

According to UK Finance, 1.3 million fixed mortgage deals are set to end in 2025. Many homeowners will hope the Bank of England acts quickly to cut rates more aggressively. At the same time, savers will likely root for rates to remain at or near their current levels.

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Application Error

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November 8, 2025

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Gen Z’s love for ‘finfluencers’ is creating the perfect storm for brands | Fortune

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1 day ago

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November 7, 2025

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Gen Z’s love for ‘finfluencers’ is creating the perfect storm for brands | Fortune

Twenty-six million dollars. That’s how much investing platform Robinhood paid out earlier this year after it was found to have breached a range of financial regulations. Amongst them? Failure to properly manage the social media influencers promoting their products. With these so-called “finfluencers” becoming an ubiquitous part of fintech marketing strategies, this eye-watering penalty should serve as a cautionary tale to brands putting content and reach above compliance and risk. 

The world of the finfluencers has expanded dramatically in recent years. These young, passionate and social media savvy voices amass legions of fans and millions of views as they dole out advice on everything from stock tips to savings techniques. The main audience? Gen Z. Facing the dual pressures of a tough job market and the spiralling cost of living, Gen Zs are turning to social media for new routes to financial stability — hungry for insights and advice that will help them get ahead. With a huge 34% of Gen Zs saying they learn about personal finance from TikTok and YouTube, finfluencers have exploded in number, reach and power. 

Acquiring Gen Z customers is a huge priority for marketing teams. In the world of financial products, customers are sticky. Get them young and you might have a customer for life. That’s why the rise of finfluencers represents a huge opportunity for companies operating across the finance, investment and savings space. And it’s one they’ve been tapping into. 

On the surface, engaging finfluencers for paid partnership is a marketing slam duck for fintech and finance brands. Unlocking a route into Gen Z audiences via trusted, engaging voices. But, as Robinhood’s experience shows, the stakes are high when you get it wrong. Any company selling financial products or services is subject to a litany of regulation. And these high standards of compliance aren’t necessarily compatible with the fast-paced, algorithm-chasing game of social media content creation. It’s a conundrum that’s starting to trip brands up. 

Alongside Robinhood, this year has also seen Public Investing fined $350k by the US regulator FINRA after influencers made misleading claims. And a recent crackdown from the UK’s financial regulator, the FCA, saw three individual finfluencers end up in court charged with encouraging high-risk strategies without the correct authorisation. Brands and the influencers they rely on are sailing far too close to the wind. 

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And this risk-reward matrix is only set to become more intense. The use of AI tooling in marketing is speeding up content creation and enabling thousands of iterations of adverts to run simultaneously. And brands are increasingly upping the percentage of marketing budget allocated to social media. Collectively, this is encouraging faster, more dynamic social strategies, with influencers forming a critical part. It’s putting marketers on a potential collision course with regulators cracking down on violations. 

Companies leveraging social media partnership with a view to reaching Gen Z customers cannot afford to overlook this reality. From eye-watering fines to a tarnished brand, the implications of getting your social marketing wrong are severe. 

But that doesn’t mean brands can’t play in this space. They just need to be smart about it. 

Businesses swimming in this pool need to ensure they aren’t sidelining the compliance and risk management strategies that will keep them on the right side of regulation. This cannot be an afterthought. Marketing teams must invest in tooling, work closely with legal teams, and run stress tests on campaigns to ensure they are watertight. 

Regulators are coming for finfluencers and the businesses that work with them. Companies should heed the warning and not let their quest for young, digitally-savvy customers rush them into an approach which could see them break the law and sink their finances. Instead, the same level of zeal applied to the creative should be applied to the compliance. They are two sides of the same coin. Combined, they’ll allow companies to cash in. 

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The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Sanctioning Hizballah Finance Operatives – United States Department of State

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2 days ago

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November 6, 2025

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Sanctioning Hizballah Finance Operatives – United States Department of State

The United States sanctioned financial operatives funneling tens of millions of dollars from Iran to Hizballah. These individuals collaborate with businessmen and exchanges to enable significant financial transfers from Iran and conduct covert business dealings that fund Hizballah’s terrorist activities.  

This action supports President Trump’s whole of government policy of maximum pressure against Iran and its terrorist proxies like Hizballah, as detailed in National Security Presidential Memorandum 2 issued on February 4.  

The United States is committed to supporting Lebanon by exposing and disrupting Iran’s covert financing of Hizballah. By enabling Hizballah, Iran holds Lebanon back and undermines its sovereignty. Iran and Hizballah cannot be allowed to keep Lebanon captive any longer. The United States will continue using every tool at its disposal to ensure this terrorist group no longer poses a threat to the Lebanese people or the broader region. 

Today’s action is being taken pursuant to Executive Order (E.O.) 13224, as amended, which targets terrorists and their supporters.  The Department of State designated Hizballah as a Specially Designated Global Terrorist pursuant to E.O. 13224 on October 31, 2001, and as a Foreign Terrorist Organization on October 8, 1997.  For more information, today’s designation can be found on the Press Release. 

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