NatWest has confirmed a "huge drop" in the interest rates attached to some of its leading mortgage products in a boon for prospective homebuyers.
The high street store announced the drastic cuts amid a recent wave of rate hikes from its competitors, including Santander.
As of today (November 25), NatWest is reducing interest rates on selected new two and five-year fixed-rate mortgage deals.
This means that cheaper loans will be available to first-time buyers, those looking to remortgage and people buying buy-to-let deals.
According to the bank, mortgage rates will be dropped between 0.41 per cent and 0.2 per cent depending on the deal.
Homeowners have been saddled with high mortgage repayments following recent action from the Bank of England.
Do you have a money story you’d like to share? Get in touch by emailing money@gbnews.uk.
Homeowners have been saddled with rising mortgage repaymentsGETTYOver the last two years, the central bank's Monetary Policy Committee (MPC) has opted to raise and hold the UK's base rate to 5.25 per cent.
In August, MPC members narrowly voted to cut rates to five per cent which analysts have signalled will trigger a response from high street banks and building societies.
Bank Governor Andrew Bailey previously noted that reductions in the base rate are on their way due to inflation falling.
Economists at Goldman Sachs have floated that the base rate could come down to as low as 2.75 per cent over the next year.
Speaking to Newspage, Simon Bridgland, the director at Release Freedom, outlined why NatWest is making cuts now and what it could mean.
He explained: "NatWest knock it out of the park with some huge rate drops. Things are set to heat up this week as pressure piles onto lenders to secure new business before the year is out.
"Lenders changing fixed rate deals in quick succession means we could be witnessing the start of a call to arms from lenders chasing down borrowers before we see in 2025."
Tony Castle, the managing director at PFG Mortgages, added: "NatWest now reducing rates quite significantly shows the volatility surrounding mortgage rates at the moment.
"Within a week they have increased rates and have now almost done a complete U-turn in decreasing.
LATEST DEVELOPMENTS:
The high street lender is making drastic changes to its line of mortgage products
PA"It’s going to be an interesting few weeks ahead that’s for certain. Borrowers locking in rates at the moment have to be on their toes with rate fluctuations."
Katy Eatenton, the Mortgage and Protection specialist at Lifetime Wealth Management, said: "NatWest clearly aren't too worried about the Budget as these are serious cuts.
"NatWest have just smashed it out of the park and their competitors will be wondering what's going on.
"After a week or so of rates rising, they are now going back down again. Other lenders will surely now follow and that's fantastic news for borrowers and the property market."
