Lender also cuts mortgage rates and raises borrowing limits amid market-wide reductions
High street lender Barclays is reducing mortgage rates across several products, including a five-year fixed Green Home mortgage at 3.96% – the lowest five-year fixed rate available on the market.
The deal, which requires a 60% loan-to-value (LTV) ratio and comes with an £899 fee, is available for buyers purchasing energy-efficient new build homes with an energy performance rating of 81 or higher or classified in bands ‘A’ or ‘B’.
The bank is also lowering rates on select mortgages by up to 0.48 percentage points. Among the changes, its two-year fixed mortgage at 90% LTV with no product fee will now be set at 4.93%.
Additionally, Barclays is increasing borrowing limits for 90% LTV loans. The cap has risen from £570,000 to £640,000 for houses, and from £275,000 to £310,000 for flats.
The revised rates and loan limits take effect tomorrow, March 4.
The move aligns with a broader trend of major UK lenders cutting mortgage rates. Santander recently introduced sub-4% fixed deals, with Barclays, HSBC, and Nationwide following. The adjustments come as financial markets anticipate further interest rate cuts by the Bank of England, following its latest 0.25 percentage point reduction in February. Investors are now pricing in the possibility of at least two more cuts this year.
“With bills and costs rising, we know how challenging homebuyers are finding things right now,” said Sian McIntyre, managing director of mortgages and savings at Barclays. “We’ve introduced several rate drops already this year across our mortgage range, making a real difference in affordability, and we’re delighted to announce more rate cuts. This includes bringing our Green Home mortgage even further below 4%, making it the lowest five-year fixed rate available on the market.”
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