Barclays cuts rates to help borrowers escape SVR hikes

Barclays is launching three competitively priced fixed rate mortgages to help borrowers who will have to pay out more on their monthly mortgage payments due to the impact of competitors increasing their Standard Variable Rate (SVR).

The new rates include a market leading remortgage package. The two year Great Escape will be reduced from 3.49 per cent to 3.29 per cent for those with a deposit or equity of 30 per cent, which allows customers to switch their mortgage to Barclays with no application fee, free legal work, free valuation and £300 cashback.

A borrower switching from a competitor's Standard Variable Rate of 4.74 per cent to a Barclays two year fixed Great Escape at 3.29 per cent will make a saving of more than £2,800 over the two years. Barclays research further shows that the average homeowner spent 14.9 per cent of their take home pay on mortgage payments last month. Borrowers on competitor SVRs whose payments are increasing by 0.50 percentage points will see this increase to 16.2 per cent following the rate rise.

The other key rate reductions are a drop of 0.20 percentage points on selected two year fixed rates For those with a 40 per cent deposit, the rate will now be 2.69 per cent, and a 30 per cent deposit 2.89 per cent. These rates come with the standard £999 application fee and £499 for customers who qualify for a Barclays loyalty mortgage. These deals also allow borrowers to remortgage using our ‘Switch and Save' service which also helps with remortgage costs, offering free legal work plus a valuation or £200 cashback.

Andy Gray, Head of Mortgages at Barclays said "We know that an increase in competitor SVRs will put extra burden on consumers who are already squeezed due to other household costs rising. The good news is that fixed rates are near historic lows, so many of these customers stand to gain from remortgaging to a new product. These new deals are about showing borrowers who are impacted by higher rates that there are other options to move to a cheaper fixed rate elsewhere and as a result we are expecting these deals launched today to prove very popular."

All these deals revert to a lifetime tracker of base plus 3.39 per cent. The remainder of our fixed, tracker and offset range is maintained.

For further information on Barclays mortgages, visit barclays.co.uk/mortgages.