Third Base Rate Cut Of 2025 To 4%

As widely anticipated, the Bank of England has voted to reduce the base rate to 4%. This is the third incremental cut of the year and means the base rate is at its lowest since February 2023.

Swap rates are also marginally down month on month, which has been good news for mortgage borrowers due to competition amongst lenders. Whilst sub 4% rates have been a feature for lower loan-to-value mortgage borrowers throughout the year, higher LTV borrowers have seen the greatest improvements since the last base rate cut in May.

In the lead up to May's reduction to 4.25%, a first time buyer with 10% deposit would have seen rates starting from 4.59%. As of today, the same borrower would achieve rates from 4.29%.

Remortgage customers at increasingly higher loan to values are also beginning to get better value in rates- Halifax, TSB, Nationwide, Virgin Money and Santander are now all offering sub 4% rates at 75% for new borrowers.

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