The average five-year fixed mortgage rate fell below 6% for the first time since September

Interest on the average five-year fixed rate mortgage fell below 6 percent to 5.95 percent for the first time in seven weeks, as more lenders slashed their rates.

According to Moneyfacts, two-year fixed-rate deals are now averaging 6.13 percent.

These are down from 6.32 percent for the five-year reform and 6.47 percent for the two-year reform on November 1.

The drop in the five-year average would save borrowers £43 on their monthly payments for a £200,000 mortgage, compared to those who hooked up at the start of the month. For a 2 year fixed deal the saving is £42.

Gradual decline: The average five-year fixed mortgage rate fell below 6% for the first time in seven weeks

Mortgage rates soared in the wake of then-chancellor Kwasi Quarting’s ill-fated mini-budget. Borrowing costs jumped in the UK as investors sold off UK government bonds – known as gilts – before the Bank of England stepped in to announce a £65 billion bond-buying program to prop up the market.

The two-year fixed rate average jumped from 4.74 percent on September 23 (the budget day) to 5.17 percent a week later on September 30.

On October 20, the two-year and five-year reforms reached 6.65 percent and 6.61 percent, respectively.

The last time the average two-year fixed-rate mortgage was 6.65 percent or more, back in August 2008, it was 6.94 percent. The last time the average five-year fixed mortgage was 6.51 percent or more, it was back in September 2008 at 6.52 percent.

However, there is some good news as prices are slowly starting to fall. Last week, the average cost of two-year fixed-rate deals across all loan classes fell to value each day, according to Moneyfacts.

Rachel Springol, finance expert at Moneyfacts.co.uk, said: “Borrowers may breathe a sigh of relief to see fixed mortgage rates starting to fall, but there may be much more room for improvement.

With the average five-year fixed rate mortgage rate down below 6 percent for the first time in seven weeks, borrowers who’ve paused home equity plans, or indeed put off the idea of ​​refinancing, may now be tempted to scrutinize the latest deals on offer. . .

However, it should be noted that rates could drop further, but there is no clear answer as to how quickly. Today, only a few lenders offer fixed deals of less than 5 percent. Borrowers may feel they have to wait a little longer before they commit to a new fixed mortgage, or even wait until next year to see how the market recovers from the recent interest rate uncertainty.

Mortgage rates are starting to fall after a sharp rise last month in the wake of the mini budget

This week, Santander announced that it is cutting all residential mortgage rates by up to 0.45 percent. The bank said in a note to brokers that all residential tracker prices have also been slashed by up to 1.25 percent.

In addition, Nationwide is cutting the prices of its two-, three- and five-year fixed deals by as much as 0.3 percent. For new customers moving into a home, the lender’s two-year flat rate of 75 per cent will drop by 0.25 per cent to 5.39 per cent, with a fee of £999.

For the first time, the five-year fixed rate at 90 per cent lifetime value will drop buyers by 0.15 per cent to 5.29 per cent, with a fee of £999. The two-year LTV tracking rate also fell 85 per cent, down 0.3 per cent to 3.94 per cent, with a fee of £999.

We’re already starting to see five- and two-year fixed rates coming down, and I’m sure we’ll see other lenders follow suit over the coming weeks,” said Natalie Haynes, founder of Premier One Mortgages brokerage in Sutton Coldfield. .

I think we can expect to see some more upside in the base rate, but it will eventually stabilize between 3 percent and 4 percent.

“With swap rates now stable, the 18-month average fixed rate is likely to be no different from where we are now.”