Building Society to reduce fixed mortgage rates this week in ‘welcome news’

Coventry Building Society has announced it will be reducing interest rates across its fixed mortgage product range on Friday morning.

New and existing residential borrowers will benefit from reductions across all fixed remortgage rates, as well as fixed purchase fee rates. Rates across two, three, and five-year fixed purchase products will also fall, as well as first-time buyer rates, offset, interest-only, and offset interest-only rates.

New and existing buy-to-let and portfolio buy-to-let borrowers will see a reduction in all fixed-rate products.

Brokers have welcomed the news, specifically the timing as many two-year fixed rates are due to mature in the fourth quarter.

Writing on the platform, Peter Stamford, director at Alston-based Moor Mortgages said: “Just in time for the festive season, Coventry BS is rolling back rates to where they were last summer.

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“If you’re one of the many who rushed to seal a two-year deal before Christmas 2021, now’s the time to ring your adviser. Coventry’s making a serious play for market share, and you could benefit.”

Emma Jones, managing director at, also said this could benefit borrowers who locked into two-year fixes at the end of 2021. She explained: “This is welcome news ahead of some of the Christmas maturities we will likely see due to the rush for Christmas completions back in 2021 for those who took two-year fixed rates.

“It’s a good time to check in with your adviser if you have an application in progress with Coventry BS to see if any of these new rates are available to you.”

Steven Hargreaves, mortgage and protection adviser at The Mortgage Co, added: “More good news on the mortgage front. Coventry are doing their best to grab their share of the mortgage market in quarter four.

“Let’s hope these cuts start to stimulate the housing market. The current round of interest rate reductions means rates are similar to the rates available at the end of June before they increased sharply.”

Justin Moy, managing director at Chelmsford-based EHF Mortgages,said further cuts in fixed rates “show exactly how competitive” the mortgage market has become, with lenders reducing margins to increase their share of a small market.

She added: “Coventry BS continue to be both proactive and competitive with their mortgage range, with a reprice across their whole range including offset deals. Long may it continue.”

Average mortgage rates across the five-year fix market (75 percent Loan to Value) have dropped as much as 0.11 percent in the last week, according to Kellie Steed, mortgage expert at Uswitch. Average two-year fixes (90 percent LTV) have dropped by 0.015 percent.

Meanwhile, average mortgage rates across the top six lenders, including Nationwide, Santander, HSBC, Halifax, Barclays Bank, NatWest, and Lloyds Bank, have remained largely unchanged since last week.

According to Ms Steed, the average two-year fixed-rate mortgage (75 percent Loan To Value) is currently resting at 5.69 percent.

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The average five-year fixed-rate mortgage rate (75 percent LTV) is unchanged at 5.14 percent.

Two-year variable-rate mortgage rates across the big six lenders (75 percent LTV) are averaging 5.84 percent.

A two-year fixed-rate mortgage with 90 percent LTV is now averaging 6.09 percent, while the average standard variable rate (SVR) is currently resting at 7.99 percent.

Ms Steed commented: “Jeremy Hunt is due to present this year’s Autumn Statement on November 22, with suggestions surfacing that it may include some elements of much-needed first-time buyer support. With high rental and living costs limiting deposit savings, high house prices meaning larger deposits are needed, and higher interest rates making it difficult to qualify for a big enough mortgage, first-time buyers haven’t had it easy over the past 18 months.

“Many people will, therefore, be looking to the Government to support those hoping to buy their first home. There’s been some speculation over what measures could potentially be introduced, with improvements to the LISA scheme and an extension of the mortgage guarantee scheme both suggested as potentials.”

The LISA is an ISA that can be used by those under 40 to save for either their first home or retirement – with the Government topping up personal savings by up to 25 percent.

However, Ms Steed noted: “Current limitations mean they can only be used to purchase properties up to the value of £450,000. This makes it much less valuable for those in London and the South East. The average property price in the capital currently sits at just shy of £542,000 according to Zoopla.

“It’s also been suggested that an additional ISA product aimed at homeowners may be introduced. This could be in place of the help-to-buy scheme, which is no longer available outside of Wales – however, the details of any definitive schemes are not currently available.

“There have also been hints that the mortgage guarantee scheme, which was introduced at the height of the pandemic, could be extended. This scheme was developed to encourage lenders to return to 95 percent mortgage lending, at a time when the level of employment uncertainty was high – with the Government offering to cover a percentage of losses lenders might make.

“However, with the majority of lenders now offering a range of 95 percent mortgages outside of the scheme, it’s unclear how much assistance this would realistically provide to prospective homeowners.”

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