The cuts come ahead of a Bank of England base rate decision next week
NatWest has implemented further reductions across new business and existing customer deals(Image: NurPhoto, NurPhoto via Getty Images)
The mortgage market is hotting up as NatWest becomes the latest high street giant to unleash rate cuts. Brokers say lenders are locked in a pre-Christmas price war, with headline deals tumbling as markets put the chance of a base rate cut next week at 90%.
NatWest has rolled out a new 3.62% two-year fixed purchase mortgage at 60% loan-to-value (LTV) with a £1,495 fee, alongside a 3.66% two-year fixed remortgage, also at 60% LTV with the same fee. The reductions come as rivals including Santander and Barclays have announced their own cuts.
Darryl Dhoffer, founder of Bedford-based The Mortgage Geezer, said: “NatWest are keen not to miss out on the festive action as other big lenders have been cutting aggressively.”
Craig Fish, of London-based Lodestone Mortgages, told Newspage that lenders were showering borrowers with early Christmas gifts. “In the run-up to Christmas, the festive feeling is definitely in the air, with lenders handing out rate reductions like Christmas presents. The feeling is that this is likely to continue in coming weeks and into the New Year.”
Shaun Sturgess, of Sturgess Mortgage Solutions in Swansea, said the battle to offer the lowest rates was “heating up”. He added: “Any reduction on core two-year products makes a real difference to affordability, and it brings a renewed sense of optimism as we move into the New Year.”
Others suggested that lenders were making their move ahead of Threadneedle Street. Justin Moy, from EHF Mortgages, said: “Things are looking very positive right now at the end of 2025… we move ever closer to what will hopefully be a cut to the base rate next week.”
Jack Tutton, from SJ Mortgages in Fareham, said: “NatWest are the latest lender to enter the current rate war… The market is hotting up due to the strong prediction of a base rate cut before Christmas and potentially more cuts to come in 2026.”
However, debt expert Patricia McGirr, from Repossession Rescue Network, warned that the fanfare concealed deeper issues.
“Lenders cutting rates is great theatre, but it does nothing for the households trapped on standard variable rates (SVRs), stuck in arrears or welded to an interest-only loan with no exit,” she said.
“These glossy headline rates are for the financially flawless… millions remain locked out of the system through no fault of their own.”
Santander
Santander has slashed residential and buy-to-let (BTL) fixed rates across its ranges by up to 0.15%, with prices now starting at 3.51%. Its current lowest rate – 3.51% – is down 0.56 percentage points from 4.07% at the start of the year. New 60% and 75% LTV two- and five-year fixes for home movers start at 3.51% with a £1,999 fee and minimum £500,000 loan size.
Selected 75%–90% LTV five-year fixes now start at 3.65%, while first-time buyer deals at 85% and 90% LTV begin at 4.06% after being reduced by up to 0.15%. Remortgage five-year fixes at 60%–90% LTV have been trimmed to start from 3.99%, and new-build products cut by up to 0.15%.
BTL purchase rates at 60%–75% LTV now begin at 3.74%, down by up to 0.08%, while BTL remortgage five-year products at 60%–75% LTV start from 3.85%. Graham Sellar, Santander’s head of intermediaries, said: “2025 has been the year of the buyer… our final rate change of 2025 continues this positive trend.”
Barclays
The bank has reduced a series of products including its two-year 60% LTV remortgage fix with a £999 fee, now down from 3.81% to 3.71%. Its Great Escape two-year fix at 75% LTV with no fee has dropped from 4.17% to 4.12%, while its five-year 75% LTV fix with a £999 fee falls from 3.92% to 3.88%.
Existing customer “EMC Reward” deals have also fallen – the two-year 75% LTV fix with a £999 fee down from 3.92% to 3.81%, and the five-year no-fee equivalent from 4.10% to 4.04%.
NatWest
NatWest has implemented further reductions across new business and existing customer deals.
These include:
- A two-year fixed purchase at 60% LTV with a £995 fee cut from 3.76% to 3.67%.
- The 60% LTV fix with a £1,495 fee reduced from 3.71% to 3.62%.
- Five-year fixed purchases at 90% LTV trimmed to 4.33% (no fee) and 4.20% (with £995 fee).
- Remortgage deals at 60% LTV reduced to 3.71% (£995 fee) and 3.66% (£1,495 fee).
- BTL two-year 75% LTV fix down 8bps to 3.29% (fee £3,999).
- BTL five-year 60% LTV remortgage down to 3.52% (fee £5,999).
Last week, Nationwide cut its own fixed ranges, with its lowest rate now 3.58% – the first time the building society has offered a sub-3.60% fix since September 2022.
