Some sub-4% mortgages will vanish from the market from Friday
Some sub-4% mortgage deals will disappear from the market from Friday, when Santander UK pulls some products from sale just over a week after they launched, amid changing market conditions.
The bank notified brokers on Thursday that from 10pm on February 21, it will be removing its 3.99% five-year, fixed-rate mortgage products.
It said the decision has followed an increase in five-year swap rates, which are used by lenders to price mortgages, across the past week.
It means that a 60% loan-to-value, five-year, fixed-rate at 3.99% for home buyers and five-year, fixed-rate deal at 60% LTV for homeowners looking to remortgage, at 3.99%, will be withdrawn from sale.
Santander will continue to offer two-year, fixed-rate mortgages at 3.99%, both to home buyers and those looking to re-mortgage. These deals also require a 40% deposit or equity.
The sub-4% deals were launched onto the market by Santander UK on Thursday last week.
On Wednesday this week, mortgage experts suggested that deals below 4% may be short-lived, following stronger-than-expected inflation data.
Figures released by the Office for National Statistics (ONS) on Wednesday showed that the rate of Consumer Prices Index (CPI) inflation rose to 3% in January, from 2.5% in December. Analysts had predicted a 2.8% increase.
Despite the higher-than-expected inflation data, Santander said its forecasts are still pointing to further Bank of England base rate cuts this year.
Get a free fractional share worth up to £100.
Capital at risk.
Terms and conditions apply.
'That hasn't taken long to feed through, and Santander has announced that it will be withdrawing its five-year fix at 3.99% at the end of tomorrow, citing an increase in market rates as the driver. Its two-year, 3.99% fixed rate will remain in place.
' Co-operative Bank has also announced that it will temporarily withdraw some of its fixed rates from close of play tomorrow.'
Mr Hollingworth continued: 'It's not all bad news. Barclays has managed to find room for improvement in its existing customer products and both Nationwide Building Society and Halifax have just announced their intent to cut rates from tomorrow.
'Although the movement in swap rates, which are a key indicator for fixed mortgage rates, has not been enormous, it does look to be enough to put some of the very lowest rates in peril.
'It's not a need for panic but borrowers that have been considering a new deal may want to reach a decision sooner rather than later in case of more movement in rates.
'The constant shift in mortgage rates can be frustrating but the good news is that the longer-term expectation for Bank of England base rate is that it will continue downwards as the year progresses. What we don't know is when it will next fall and how far.'
Nationwide Building Society said that, from Friday, it will reduce rates by up to 0.33 percentage points, with its rates now starting from 4.09%.
The new rates include a five-year, fixed-rate at 60% LTV with a £1,499 fee with a rate of 4.09%, having been reduced by 0.05% percentage points.
Carlo Pileggi, Nationwide's senior manager – mortgages, said: 'These latest reductions bring five-year and two-year fixed rates closer together.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Telegraph
8 hours ago
- Telegraph
‘People call Gen Z lazy but we're not. I'm 21 and wear a Rolex'
'People call Generation Z lazy but we're not,' says Aryan Gulzar. Aged 19, with no experience but bags of ambition, he poured his student loan into starting a company. He is one of a wave of young people opting out of traditional employment, searching for a better life. Research by consultancy PwC found that 25pc of British 18- to 24-year-olds have considered leaving the workforce in the last year. For young people in their 20s and early 30s, starting a business offers an escape from bad bosses, meagre earnings and career stagnation. No wonder that 75pc of those born after 1996 now want to be their own boss, according to a recent poll by Santander. This compares to 57pc of millennials who either already have their own business or plan to launch one, 36pc of Generation X and 25pc of boomers. Gulzar's role model is Stephen Bartlett, an entrepreneur and investor who has appeared on Dragon's Den. 'We just believe in working smarter, not harder,' he says. 'I did okay in my A-levels, but I'm just a normal guy and here I am, 21 and wearing a Rolex. 'Employment isn't the only option any more' Gulzar knew that the odds were stacked against him. 'I don't come from money, I'd never had a job before and live in a poorer part of Birmingham,' he says. He enrolled in a business development course at Aston University in 2023 and created a business that same year to boost his income. 'I searched online for 'best business to start now',' he says. Gulzar says that the timing was right to start the business because, he says, 'I had no responsibilities'. He invested his entire £3,500 university maintenance loan into registering AKG Media, building a website and paying for a £1,200 year-long course in influencer marketing. 'You don't need much to start a business,' says the 21-year-old. He focused on a small niche, helping AI start-ups to grow, but struggled at first, landing just five clients in his first year. By the end of year two, he had 100 paying customers. He claims that some clients now spend six figures a month with his agency. Gulzar regularly works 12-hour days on his business and says he inherited his work ethic from his marketeer father, Sarban. He credits his parents for encouraging him to walk a different path. 'My dad especially always told me to believe in myself and to see failure as a learning opportunity,' he says. Sarban and Ranjeeta, Gulzar's mother, who works with children with special needs, have allowed Gulzar to live at home rent-free while he pursues his business dreams.
Glasgow Times
9 hours ago
- Glasgow Times
Major bank set to close Glasgow branches this month
Santander bosses revealed that five Scottish branches will disappear from the high street this month, the Sun reports. Meanwhile, four more branches are expected to close in July. (Image: PA) We reported how the banking firm revealed that it would be closing at least 95 sites across the UK. Santander announced the closures in March 2025, putting 750 people at risk of redundancy. READ MORE: 750 jobs at risk as Santander announced 95 branch closures READ MORE: RBS reopened busy Glasgow branch after huge makeover Earlier this year, a Santander UK spokesman said: 'As customer behaviour changes, we are ensuring that our branches remain fit for the future. 'Our new combination of full-service branches, alongside work cafes, counter-free branches and reduced hours branches, aims to provide the right balance between digital banking and face-to-face money management and guidance.' They added: 'Closing a branch is always a very difficult decision and we spend a great deal of time assessing where and when we do this and how to minimise the impact it may have on our customers.' Santander has several branches across Glasgow, including one on Argyle Street and another one on Byres Road in the West End. Here is the full list of Santander branches that are set to close in Scotland this summer, according to the Sun:
Scottish Sun
10 hours ago
- Scottish Sun
Major bank to close more Scots branches this month in huge blow to high streets
Check if your local bank has been impacted DON'T BANK ON IT Major bank to close more Scots branches this month in huge blow to high streets Click to share on X/Twitter (Opens in new window) Click to share on Facebook (Opens in new window) SANTANDER chiefs have revealed that five Scottish branches will be disappearing from the high street this month. And four more are expected to follow suit in July as more customers choose to bank online. Sign up for Scottish Sun newsletter Sign up 3 A total of nine Scottish Santander branches are set to close this summer Credit: Reuters 3 It comes as more and more customers shift to online banking Credit: EPA Back in March, the popular banking chain revealed that it would be closing at least 95 sites across the UK. The move, which put 750 people at risk of redundancy, comes as the industry continues to shift its focus to online and digital platforms. Over recent years, Santander has seen a surge in their online banking, with over half of their new accounts being set up online. And bank bosses said that cash being sent by mobile banking has also gone up by 89 per cent. They added that the amount of business done in brick-and-mortar branches has plummeted by 61 per cent, which has reduced the need for in-person services. This month, the first round of closures is underway, and more are expected to follow suit. Alongside the 95 closures, other branches are having their opening hours slashed. While others are being transformed into "counter-free" branches, where customers can still meet with staff. Just one branch in Irvine, Ayrshire, is having it's opening hours cut down. While the branch on Port Street in Stirling is the only one being turned into a counter-free branch. Bank of Scotland to Close 22 Branches: A Digital Transformation The only alternative is 'Banking Hubs', which have been launched to give customers access to cash and services, regardless of which bank they are with. The closures come after research from consumer champion Which? found that a total of 6,161 banks and building societies branches across the UK have closed since January 2015. This works out to an average of around 53 branches per month. However, this is becoming increasingly concerning for older people who may not be banking online. Santander previously said that staff were contacting their more vulnerable punters to inform them about the closures and what they can do. The full list of Santander Scottish branches that are set to close this summer is as follows: Peterhead - 16 June Arbroath - 17 June Glasgow MX - 23 June Glasgow LDHQ - 24 June Musselburgh - 30 June Cumbernauld - July 7 Saltcoats - July 21 Wishaw - July 22 Hawick - July 24 A statement on the Santander website reads: "We last did a major review of our branches in 2021. "Since then, many of our customers are choosing to use Mobile, Online and Telephone Banking more, and branches less." What to do if your local bank branch closes nges, they need to check whether local communities will be left without important cash services, like branches or ATMs, and fix any significant gaps. Residents and community groups can also ask for a review of cash-access gaps, and the providers have to respond. If big gaps are found, banks and building societies need to offer reasonable alternatives, like keeping branches or ATMs open until new ones are set up. GROWING CONCERNS The move has sparked concerns around older customers who may struggle with online banking. Many are also worried about the impact the closures could have on vulnerable people with limited access to online facilities. Charities like Age UK are campaigning to maintain some in-person banking options, with 4 million older Britons unable to manage their finances online. Caroline Abrahams, charity director at Age UK, said: 'Physical spaces – whether a bank or building society branch, Banking Hub, or alternative suitable provision – must continue to exist so people can still carry out face-to-face tasks. "The disappearance of face-to-face banking risks cutting a significant minority of the older population out of an essential service, making it difficult if not impossible for them to manage their money and maintain their independence.' Solutions can include setting up banking hubs, new ATMs, or using Post Office facilities to keep cash services going. The vast majority of banking customers are moving online and don't need a physical branch as much as before. But any closures can be an issue for others, particularly elderly people in rural areas who don't have access to the internet. However, if your local branch is set to close, or has recently, you have some options. You can carry out most basic banking tasks at your nearest Post Office. You won't be able to apply for a loan or open a new bank account at once though. You can find your nearest Post Office branch by using the locator tool on its website. Plus, hundreds more banking hubs are set to open to replace lost banking services following years of widespread branch closures.
