Barclays (LON:BARC) mortgage arm Woolwich have announced they will be reducing their Standard Variable rate (SVR) by 1.15 percent to 5.49 percent following the bank of England interest rate cut today, not such a great reduction considering Woolwich did not make any cuts in November.

HSBC (LON:HSBA) have agreed they will also cut their SVR by at least 1 percent, Bristol & West also said they will reduce their SVR by at least 1 percent following the base cut.

Customers of Halifax will reap the benefits of the interest rate cut if they hold an existing tracker rate mortgage that pegs the bank of England base rate, as they have agreed to pass on the full 1 percent rate cut. Halifax did have a clause in its tracker mortgage contracts stating that they do not have to pass on any reductions if the BOE base rate reaches 3 percent.

Lloyds TSB (LON:LLOY) which are in the process of merging with HBOS were the first to announce they will be cutting their SVR to 4 percent. However as the bank states that it’s SVR will never be more than 2 percent above the base rate. Lloyds did not have an alternative.

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Northern Rock who earlier this year become nationalized by the UK government, have introduced new fixed rate mortgage deals and raised the interest rate on their tracker mortgage products.

Northern Rock have increased the rates on all new Trackers by 0.5 percent, but have introduced new lower fixed rate deals, a two-year fixed deal with a 75 percent Loan to Value (LTV) has been cut by 0.7 percent from 5.69 percent to 4.99 percent, this mortgage product also holds a arrangement fee of £995.

Northern Rock are also offering a one-year fixed product with a mortgage rate of 3.99 percent, however you do need to put down 35 percent of the property value to qualify for this deal.

With the Northern Rock mortgage product once your year contract is up, you are not tied to the deal and will not be penalized for changing lender or product, unlike the 1-year fixed deal called “fix and track” at 3.99 percent that the Woolwich, Barclays mortgage arm is offering, with this deal you are contracted to the deal for 3 years, 1 year on the fixed mortgage rate and 2 years on the banks tracker rate which tracks the Bank of England base rate. With the Woolwich deal, if you wanted to come out of it before your mortgage contract is up you would have to pay a redemption penalty.

Source: timesonline

Lloyds TSB who did not pass on the Bank of England base rate cut last week onto its Tracker Mortgage rates has now increased some of its Tracker deals by as much as 0.5 percent this would mean that some of the Lloyds TSB Tracker rates carry mortgage rates 0.8 percent higher than they would have been if they had just followed the bank of England base rate cut on half a percent.

However, Woolwich building Society did pass on the base rate reduction and cut its Tracker rates but has now increased lifetime and offset rates by 0.2 percent saying that they did it because influx of requests after the cut had been “unsustainable”.

Head of Mortgages at Woolwich Andy Gray said: “We are seeing unsustainable flows of customers to the Woolwich since changes by other lenders left us with some of the only competitively priced mortgages in the market” to the news agency.

August 2008 saw new mortgages decline 60 percent from the same time last year according to the Council of Mortgage Lenders.

Source: londonstockexchange

Good news for all professional landlords, Woolwich, the mortgage arm of Barclays, is cutting rates on buy-to-let deals by up to half a percentage point.

There will be a new rate from Tuesday of 6.99 percent on its five-year fixed-rate deal, down from 7.49 per cent. The interest rate on its portfolio lifetime tracker, aimed at professional landlords, will also fall, from 1.99 percent above the base rate, currently 5 per cent, to 1.49 per cent rate above the base rate.

Last Friday Halifax owned by HBOS cut rates by up to almost a third of a point on some mortgage deals, plus the Bank of Scotland who is also part of the HBOS group reduced rates by 0.45 percentage points. It seems that the Buy-to-let landlords are benefiting from a series of rate cuts.

It’s not just the Buy-to-let landlords that have benefited from the latest rate cuts; Woolwich also cut rates on residential deals by up to 0.35 percentage points while Abbey, Britain’s second-biggest lender reduced its fixed-rate deals by 0.1 percentage points. Nationwide and Lloyds TSB have also announced cheaper deals.

The reason for the lenders reducing their rates on home loans is because there was an ease in some of the conditions in the inter-bank lending market. Swap rates, which determine the cost of fixed-rate mortgages, fell below six per cent last week after peaking at 6.5 per cent in mid June.

It now seems that banks are gently lending more, after they reduced their mortgage books earlier this year.

To benefit from the two new Woolwich rates you maximum loan would be 75 percent of the property value, so you would have to put 25 percent down as deposit. The five-year fixed-rate deal has a 1 per cent fee. It has an early redemption charge (ERC) for the first three-years of six months interest. The lifetime tracker charges a fee of £295 per property and also has an ERC for the first three years, of two months interest.

There are a few good deals out there such as this one from Stroud & Swindon currently offers one of the most competitive fixed rate deals. Its three-year fixed-rate buy-to-let home loan has a rate of 6.80 per cent with a £1499 fee on loans of up to 75 per cent of a property’s value, with no extended ERCs.

Leeds Building Society is also offering a lifetime tracker at 1.59 per cent above the base rate for life of the loan, with a maximum LTV of 70 per cent, with a £1499 fee and no early repayment charges.

Source: timesonline

Read more about UK mortgages here.

This move by Woolwich follows other lenders like Abbey and Nationwide last week. However it seems as if Woolwich still only has three mortgages lower than they were on June24, just before the lender increased some of their fixed-rate and tracker deals up by 0.4%.

It looks as though these rate cuts are good for the borrowers as they have had to put up with a range of rate increases, these are now at an 11-year high, some rates are now at 7.07%.

The Woolwich are now offering a lifetime tracker with no arrangement fees, there is also no redemption charges of 0.89% above base rate for people with a 40% deposit, this now has a rate of 5.89%.

The Woolwich has also re-launched its range of mortgages for those who only have 10% deposit, after the lender had temporarily withdrawn it.

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