Kensington Mortgages has announced rate cuts in its product offering.
The lender is cutting up to 0.4 percentage points across its residential mortgage range and 0.2 percentage points on selected buy-to-let products.
Its ‘select’ range now starts from 2.49 per cent at 75 per cent loan-to-value (LTV) and 2.99 per cent at 85 per cent LTV.
The changes follow a 0.2 percentage point decrease to the two-year fixed rates.
The residential five-year fixed rate at 85 per cent LTV has been cut by 0.4 percentage points to 3.79 per cent, while its two-year fixed products have been cut by 0.3 percentage points to 2.64 per cent at 75 per cent LTV and 2.74 per cent at 80 per cent LTV.
Buy-to-let loans have seen reductions of 0.2 per cent across its five-year fixed range.
A full mortgage application must be submitted by 5pm on 12 January 2018 for borrowers to qualify for the rate reductions.
The reductions in rates have come after the increase in base interest rates to 0.5 per cent from 0.25 per cent by theBank of England (BoE) on2 November. Remortgage applications have risen, given the expectation that base rates could rise further.
The lender also said its offerings are available to a wider range of borrowers, including those with more complex cases.
Kensington has also introduced changes on its residential large loans proposition, with rates now starting from 2.39 per cent with zero completion fee on the one-year fixed option, and cuts of at least 0.30 of a percentage point across its ‘new build’ range. This includes 0.40 of a percentage point on its residential five-year fixed product.
Provider view:
Steve Griffiths, director of sales and distribution at The Northview Group, said: “Despite the rate rise by the Bank of England, these reductions show Kensington’s commitment to providing customers with highly competitive rates for real-life lending solutions.
“Whether our customers be self-employed, contractors or have complex income streams, we are committed to offering a variety of competitive products to meet the changing demands and needs of our clients. And we are confident that these reductions will be welcomed by brokers and customers alike.”
Adviser view:
Peter Wright, co-owner at Plan Money, said: “From what I have seen, a lot of lenders have been quick to put their rates up and slow to bring them down.
“What Kensington is doing shows they are trying to come down from a place to be more competitive in the market.
“Although the reduction has followed the interest rate rise, probably because they feel that it is not so high that they lose out. But if the rates go up further, and they were to start going up before the end of the year, it would be more nerve-racking for people.”
Charges:
Zero completion fee on the one-year, fixed option for large, residential loans.
Verdict:
Kensington, among many others, has been clever at cutting fixed-rate mortgages at a time when all discussion is around interest rate rises. Remortgages at longer-term fixes has seen a spike in popularity and Kensington has taken advantage of this.
