‘Rates cut’ for Santander and NatWest customers

Customers of Santander and NatWest have been given notice of changes as the week begins.

After Santander on Friday, NatWest has become the latest lender to reveal mortgage rate reductions – of up to 0.21% – with brokers suggesting lenders are competing fiercely and are “willing to take a margin hit today to keep pipelines alive tomorrow”. NatWest is cutting rates across its range, though two-year fixed rates are experiencing the most significant reductions.

For instance, a two-year fixed rate purchase mortgage at 80% loan-to-value (LTV) will fall by 0.21%, from 4.95% to 4.74%. The lender’s two-year fixed rate purchase mortgage at 75% LTV will drop by 0.2% from 4.89% to 4.69%, while its two-year First Time Buyer fixed rate, at 85% LTV, is falling by 0.19% from 4.98% to 4.79%, with £250 cashback. All three products carry fees of £995.

Santander, meanwhile, is slashing all new business first-time buyer (FTB) 10-year fixed rates and selected home mover (including new build and large loans) fixed rates by up to 0.15% – alongside selected remortgage rates, including large loans, by up to 0.19%. New business buy-to-let purchase and remortgage fixed rates are also being reduced by up to 0.23%, though an FTB 85% loan-to-value (LTV) 2-year fixed rate with a £999 fee will increase by 0.05%. The lender’s My First Mortgage fixed rate remains unchanged.

View 3 Images

Meanwhile, two-year tracker rates for first-time buyers (FTBs) and home movers — including new builds — will be slashed by up to 0.5%, while two-year tracker rates will drop by up to 0.4% across home mover and remortgage large loans. For product transfers, selected residential two, three and five-year fixed rates will be trimmed by up to 0.15%, while all buy-to-let two and five-year fixed rates will be cut by up to 0.23%.

Riz Malik, Independent Financial Adviser at Southend-on-Sea-based R3 Wealth, said lenders are competing fiercely for new business.

He added: “As we move towards the end of the first half of 2026, lenders are keen to bolster their mortgage books and take on more new business after a muted couple of months due to the war in the Middle East. They are still conscious of the global economic backdrop but are also keen to do their best to get business on their books. Reductions in tracker rates will be especially welcomed by those not seeking to fix.”

Ken James, director at London-based Contractor Mortgage Services, agreed that rivalry is fuelling the reductions but cautioned they may fall short of kickstarting the market: “Lenders are fighting for volume in a sluggish market and they’re willing to take a margin hit today to keep pipelines alive tomorrow. However, this is a pricing strategy rather than a market turning point. Is it enough to get the UK’s housing market moving again? Not likely.”

Some brokers, however, were more optimistic. Richard Davidson, mortgage advisor at onlinemortgageadvisor.co.uk, said: “This is a strong move from Santander to reduce across the board and an indication that other lenders should follow soon. And with NatWest, that seems to be the case.”

Katy Eatenton, mortgage and protection specialist at St Albans-based Lifetime Wealth Management, suggested that “if mortgage rates continue to fall, and this is what they appear to be doing, confidence will start to return”.

View 3 Images

Aaron Strutt, product and communications director at London-based Trinity Financial, pointed out that just last week it appeared rates were heading upwards once more.

He said: “Swap rates have started to come down again and some lenders are still improving their mortgage rates even though it looked pretty certain they were going to start putting them up just a few days ago. There is a lot of economic uncertainty at the moment, but lots of people still want to get on the property ladder. We are speaking to more renters trying to purchase their rented homes using concessionary purchase mortgages as the number of buy-to-let properties being put on the market continues to rise.”

Justin Moy, managing director at Chelmsford-based EHF Mortgages, welcomed the reductions, saying: “It’s good to see Santander bringing its rates into line with the rest of the recent changes on the High Street. With almost every type of borrower benefiting in this round of changes, this will have a positive impact on those looking for a new deal or who are in an active application.”

Article continues below

Babek Ismayil, CEO at homebuying platform OneDome, added: “Conditions remain far more challenging than what they were in the mortgage market, but in the property market they are very favourable, as people are in a position to negotiate hard on price.”