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Lenders tweak trackers and SVRs after base rate cut
With the base rate falling, we have pulled together a selection of lender rate cuts, which have mainly been to tracker and standard variable rates (SVRs).
The base rate was lowered today for the first time since 2020, falling by 0.25% to 5% by a slim majority of 5-4.
Earlier this week, in an explainer piece, Mortgage Solutions said that a base rate cut would most likely lead to a change in trackers and SVRs, but fixed rate pricing may not fall dramatically as base rate cuts had already been priced in by lenders.
We have collated rate changes that have come in so far, which are correct as of 5pm today (1 August).
Santander
Santander confirmed that, following the Monetary Policy Committee’s (MPC’s) decision to lower the base rate by 0.25% to 5%, it would make changes to its tracker deals and SVR.
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The bank said that all tracker mortgage products linked to the base rate will be lowered by 0.25% from 3 September 2024. This includes the Santander follow-on rate, which will fall to 8.25%.
The lender’s SVR will also decrease by 0.25% to 7.25%, which the firm said will pass “on the full base rate decrease”, from 3 September 2024.
Virgin Money and Clydesdale Bank
Virgin Money and Clydesdale Bank have also said that they would change mortgage rates following the base rate decrease.
Virgin Money, Clydesdale Bank and Yorkshire Bank said their residential SVR would fall from 9.24% to 8.99%, while the loyalty rate aimed at residential customers who have held a Virgin Money mortgage on the same property for seven years or more will decrease from 8.99% to 8.74%.
Virgin Money’s buy-to-let (BTL) variable rate will be reduced from 9.44% to 9.19%.
The changed rates will take effect for existing customers from 1 September 2024, and for new customers from 22 August 2024.
For Clydesdale and Yorkshire Bank, the residential offset variable rate will decrease from 9.45% to 9.2%, while the BTL revert rate, an offset variable investment housing loan rate, will be cut from 9.74% to 9.49%.
The revised rates will take effect for existing customers from their next payment date after 22 August 2024, and for new customers from 15 August 2024.
Coventry Building Society
Coventry Building Society said that its SVR and all tracker rates would be cut in line with the base rate decrease from 1 September.
Kevin Purvey, director of mortgages at Coventry Building Society, said: “We try to make interest rate decisions as quickly as we can to give our members the earliest possible benefit from the changes.
“It’s welcome news for our SVR and tracker mortgage members, who will see their mortgage payments decrease from the start of September, potentially saving them hundreds of pounds a year.”
The mutual said that it would write to members about any changes to their variable mortgage accounts in the coming weeks.
Penrith BS
Penrith Building Society said that it would lower its SVR from 7.99% to 7.74%, with the change coming into force from 1 October.