Barclays GroupAug 3 2017

Barclays joins sub-1 per cent mortgage race

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Barclays joins sub-1 per cent mortgage race
BySimon Allin

Barclays has become the latest lender to offer a sub-1 per cent deal as the mortgage price war shows little sign of diminishing.

From today (3 August), the lender will offer a 0.99 per cent two-year tracker at 60 per cent loan-to-value, with a fee of £1,999, as part of a revamp of its products.

It comes shortly after Skipton launched a 0.99 per cent two-year fix and HSBC unveiled a 0.99 per cent term tracker, both at 60 per cent LTV.

Barclays is also launching a residential three-year fixed range with fee and fee-free options, following in the footsteps of Nationwide, which also recently brought back three-year fixes to cater for rising demand.

The three-year products, aimed at existing customers looking to switch, start at 1.63 per cent at 75 per cent LTV with an £899 fee, or 2.25 per cent at the same LTV without a fee.

A further innovation is the introduction of two-year buy-to-let fixed rates with a percentage fee, designed for smaller loan balances.

Rates will be available from 1.54 per cent for a two-year fix at 60 per cent LTV with a 1 per cent fee, available up to a maximum loan size of £215,000.

Barclays is also set to cut rates on its existing residential range by up to 0.41 percentage points, with rates available from 1.63 per cent for a three-year fix on both residential and remortgage.

Craig Calder, director of Barclays Mortgages, said: “We believe the changes we are making will continue to provide you with a comprehensive range of competitive products to help service a wide range of clients with diverse mortgage needs.”

Andrew Montlake, director at London-based Coreco Group, said he was not surprised that the lender price war was continuing.

“Competition is fierce, purchase transactions are down and we are going into the summer period, so it does not surprise me that lenders are still reducing rates,” he explained.

“Swap rates did go up a bit, but now they have reduced again, so I think lenders are keen to get business up over the summer period and end the year well. The battle for business will continue for the rest of the year.”

“Barclays have done well all year in terms of their offering. They have got a good range of products from all sides.”