Post Office cuts mortgage rates by up to 1.24%

The Post Office is cutting its mortgage rates by 0.64% on average across all fixed and most tracker rates.  The new rates will be available to customers from Wednesday 21 September.

The largest cut is to its 3 year fixed rate at 90% LTV - from 5.99% to 4.75%. The 4.99% 5 year fixed rate at 90% LTV is now the best in market.

It has also expanded its range of 5 year fixed rate products that help to reduce the upfront costs involved with buying a first property or switching an existing mortgage. Many deals have no arrangement or booking fees, offer £300 cashback, and can include free standard legal work and a standard valuation.  

Five of the Post Office’s mortgages are now Best Buys:

Two year fixed rate (fee assisted) at 3.85% (85% LTV)
Three year fixed rate (fee assisted) at 3.98% (85% LTV)
Five year fixed rate (£995) at 4.45% (85% LTV)
Five year fixed rate (£995) at 4.99% (90% LTV – best in market)
Five year fixed rate (fee assisted) at 4.69% (85%)

The rate reductions are also significant for the higher loan to value (LTV) products, which is good news for first time buyers.  For example:

Two year fixed rate (£995 fee) cut from 5.39% to 4.59% (90% LTV)
Three year fixed rate (£995 fee) cut from 5.99% to 4.75% (90% LTV)
Three year fixed rate (fee assisted) cut from 4.89% to 3.98% (85% LTV)
Five year fixed rate (£995 fee) cut from 6.15% to 4.99% (90% LTV)

The Post Office is committed to offering first time buyers, movers, and remortgage customers a wide range of choice and flexibility, with deals from 75% up to 90% LTV. 

Post Office Head of Mortgages, Mike Cook, said: “Many of the five year fixes that are heavily advertised are only for borrowers with a large 25% to 40% deposit, which excludes many first time buyers or those moving up the property ladder. If you only have a 10% deposit, our 4.99% five year fixed rate offers excellent value, and protects borrowers from any potential bank base rate rises during the fixed rate period.

“Our new mortgage range is very first time buyer-friendly, including deals requiring just 10% deposit.  Some have no arrangement or standard valuation fees, and £300 cashback included.”

The Post Office has also withdrawn its range of Buy To Let mortgages for the short to medium term, enabling it to focus efforts on helping first time buyers, movers and remortgage customers to get a competitive mortgage. 

Customers can pick up information about the new mortgage range and rates online at postoffice.co.uk/mortgages.