Barclays, HSBC, NatWest & Virgin Mortgage Rate Changes for May 2024

by | Wednesday 8th May 2024 | Mortgage News

Mortgage rate changes May 2024

Mortgage rate changes May 2024

In a surprising announcement that frankly none of us in the industry really predicted, Barclays Bank has announced significant reductions in the cost of some of their fixed-rate mortgage deals for residential home purchases. From today (8th of May 2024), residential mortgage borrowers with at least a 15% cash deposit (85% Loan-To-Value) stand to benefit from decreased rates, with cuts of up to 0.39%. Something that didn’t look possible last week as many UK mortgage lenders began hiking their rates up. In this blog we will run through the surprising mortgage rate changes May 2024 has to offer so far.

Mortgage Rate Changes May 2024 And Beyond

Over the last few weeks many UK mortgage lenders have once again started increasing their mortgage interest rates. Earlier last week there were several money reporters claiming that the average UK mortgage would return to 6% or more. And that didn’t seem to farfetched either! However, this new surprising announcement from Barclays is certainly a breath of fresh air.

Now of course, mortgage rates are still nowhere near where they were a couple of years ago. Long gone are the days of sub 2% mortgage rates unfortunately. But for these already accepting of the new normal rates, the products offered by Barclays are still quite competitive.

Barclays Reduce Mortgage Rates In May 2024

For those eyeing a two-year fixed-rate mortgage at an 85% loan-to-value (LTV), Barclays has slashed the rate from 5.23% to 4.99%, accompanied by an £899 fee. Similarly, the fee-free equivalent deal sees a reduction from 5.57% to 5.18%. Over a five-year term, Barclay’s purchase deal drops from 4.92% to 4.78% (85% LTV with an £899 fee), with the fee-free version falling from 5.13% to 4.95%. Yes, you read that right. Sub 5% mortgage rates available on the market. As long as you fit affordability criteria, credit score criteria, and you have enough deposit.

However, as we’ve already mentioned, not all news in the mortgage market brings such optimism. HSBC and NatWest are both poised to increase the cost of their fixed-rate product transfer deals from today’s date too.

HSBC Makes Mortgage Rate Changes May 2024

HSBC’s rate increases target existing residential and buy-to-let borrowers seeking new fixed-rate deals, or those looking to switch to a new fixed rate while increasing their borrowing. Rates for two, three, five, and ten-year fixed-rate product transfer deals are set to rise across LTV bands from 60% up to 90%. For instance, HSBC’s current two-year fixed-rate product switch deal at 60% LTV stands at 4.63% with a £999 fee, while the five-year equivalent sits at 4.32% with the same fee. The new rates will be disclosed later today but could bring them over 5% again.

NatWest Increase Rates For Residential Mortgage Borrowers

NatWest, on the other hand, is increasing the cost of its two and five-year fixed-rate product transfer deals by up to 0.12%. The lender’s new two-year rate will be 4.89% with a £995 fee (60% LTV), while the five-year deals will start from 4.53% with the same fee (60% LTV). Again, these specific rates are yet to be announced, but will bring their offering closer to 5% interest rate.

Virgin Money Increases Buy-To-Let Mortgage Rates

Meanwhile, Virgin Money is following suit by hiking the cost of their residential and buy-to-let fixed-rate deals, offered through brokers, by up to 0.2%. Core residential purchase two and five-year fixed rates, as well as product transfer deals at 65% and 75% loan-to-value, are all slated to rise. Virgin Money’s current offerings include a two-year fixed rate for purchase at 4.99% with a £995 fee (65% LTV) and a five-year equivalent at 4.49%.

Speak To An Expert About Mortgage Rate Changes

Louis Mason, Content and Communications Director at Oportfolio Mortgages, commented, “Barclays’ decision to reduce mortgage rates comes as welcome news for prospective homebuyers, offering a glimmer of hope amidst a market landscape marked by fluctuating costs. However, with adjustments from HSBC, NatWest, and Virgin Money indicating a potential trend of rising rates, borrowers should remain vigilant and seek expert guidance to navigate the evolving mortgage market effectively.”

So, while Barclays’ rate cuts may offer some respite to homebuyers, the broader market sees a mixed picture with adjustments from HSBC, NatWest, and Virgin Money indicating a potential upward trend in mortgage costs. As economic conditions continue to evolve, borrowers are advised to stay vigilant and explore all available options before committing to a mortgage deal. The best thing you can do to get ahead of mortgage rate rises is to speak with a qualified and experienced mortgage broker. Call or email our team today to see how we can help.

We're Here to Help

If you have any questions about UK mortgage news or or anything you’ve read then please get in touch. We’d love to hear from you.

As featured in

Understanding a Volatile Mortgage Market eBook

Download Our eBook

Join our mailing list and receive a link to our latest ebook, Understanding a Volatile Mortgage Market. 23 pages of practical insights to navigate the unpredictable mortgage landscape.

You Will Receive A Link To Your eBook Shortly!