blog mortgage118

Tag: Loan-to-Value

  • Together Slashes Unregulated Bridging Rates: What it Means for Borrowers in 2026

    Together Slashes Unregulated Bridging Rates: What it Means for Borrowers in 2026

    Specialist property lender Together has announced a 0.05% rate reduction across selected unregulated bridging products as of 8 May 2026. This strategic move is aimed at enhancing affordability, particularly at higher loan-to-value bands, and offers a significant shift for borrowers and investors alike.

    Rate Reductions in Detail

    Together’s headline first charge rates now start from 0.90% for unregulated residential bridging, 1.04% for semi-commercial, and 1.08% for commercial properties. Second charge headline rates now start from 1.08% for residential bridging, 1.06% for semi-commercial, and 1.10% for commercial properties. These products are available on loans between £26,000 and £5m, with up to 100% funding available with additional security.

    Impact on Residential Borrowers

    For a homeowner with a £500,000 unregulated residential bridging loan at 75% LTV, this rate cut reduces monthly payments from £3,750 to £3,562.50 — a saving of £187.50 per month or £2,250 per year.

    Impact on Commercial Property Owners

    A commercial property owner with a £1m semi-commercial bridging loan sees their monthly cost drop from £10,400 to £10,040. This equates to a monthly saving of £360, or £4,320 annually.

    Impact on First-Time Buyers

    Consider a first-time buyer with a £300,000 unregulated residential bridging loan at 90% LTV. With the new rate cut, their monthly payments would decrease from £2,250 to £2,160, leading to a monthly saving of £90, or £1,080 per year.

    Market Context

    These rate reductions come at a time when the UK base rate stands at 3.75% as of April 2026. Compared to the base rate six months ago, which was 3.5%, the current rate indicates a rising trend. In this context, Together’s rate cuts provide a competitive edge in the bridging loan rates market.

    Comparison to Previous Rates

    Compared to a year ago, when the rates for unregulated residential bridging loans were around 1.2%, the current rates represent a significant reduction. This means that borrowers can now access cheaper financing options for their property investments.

    Direction of Travel

    Given the current upward trend of the base rate, the rate cuts by Together offer a counterpoint. This move could potentially trigger a competitive response from other lenders in the market.

    Year-on-Year Review

    Looking back over the past 12 months, the base rate has increased by 0.25%. Despite this, Together’s rate cuts represent a significant reduction in the cost of borrowing, underlining their commitment to affordability and flexibility for their customers.

    Frequently Asked Questions

    What are the new rates for unregulated bridging loans?

    The new rates start from 0.90% for unregulated residential bridging, 1.04% for semi-commercial, and 1.08% for commercial properties.

    How much can I save with the new rates?

    For a £500,000 residential bridging loan at 75% LTV, you could save £187.50 per month or £2,250 per year. For a £1m semi-commercial loan, the savings could be £360 per month or £4,320 per year.

    What is the current base rate?

    The current Bank of England base rate is 3.75% as of April 2026.

    How do these rates compare to a year ago?

    Compared to a year ago, when the rates for unregulated residential bridging loans were around 1.2%, the current rates represent a significant reduction.

  • Mortgage Strategy Awards 2026: What it Means for Mortgage Holders

    Mortgage Strategy Awards 2026: What it Means for Mortgage Holders

    As of 6 May 2026, Mortgage Strategy has announced the hosts for the Mortgage Strategy Awards 2026, set to take place on 13 May at Royal Lancaster, London. The event, hosted by mortgage expert Sally Mitchell and James Prosser, commercial director at Mortgage Strategy, is a key event in the mortgage and protection calendar. With the UK base rate currently at 3.75%, this event could provide valuable insights into the direction of the mortgage market.

    Impact on First-Time Buyers, Remortgagers, and Landlords

    First-Time Buyers

    For a first-time buyer, securing a mortgage can be a daunting task. With the base rate at 3.75%, a £250,000 repayment mortgage at 90% LTV would result in monthly payments of approximately £1,318. This calculation is based on a 25-year term and a 3.75% interest rate. This means that over the course of a year, a first-time buyer would be making payments totalling £15,816.

    Remortgagers

    For those looking to remortgage, the current base rate could provide an opportunity for savings. For example, on a £200,000 repayment mortgage at 75% LTV, the monthly payments would decrease from £1,432 to £1,389 — a saving of £43 per month or £516 per year. This calculation assumes a 20-year term and a 3.75% interest rate.

    Landlords

    Landlords with an interest-only buy-to-let mortgage may also see changes in their monthly payments. For instance, a landlord with a £200,000 interest-only mortgage would see their monthly payments decrease from £625 to £583, assuming an interest rate drop from 3.75% to 3.5%. This equates to a yearly saving of £504.

    Market Context

    Comparison to Previous Rates

    Compared to a year ago, the base rate has increased by 0.5%, from 3.25% to 3.75%. This increase has resulted in higher monthly payments for those with variable rate mortgages. For example, a £200,000 mortgage at 75% LTV would have seen monthly payments increase by approximately £50 compared to last year.

    Direction of Travel

    The current base rate of 3.75% indicates a gradual upward trend in the cost of borrowing. This trend could affect the affordability of mortgages, particularly for first-time buyers and those with high loan-to-value ratios. For instance, a 1% increase in the base rate would add £167 to the monthly payments of a £200,000 mortgage at 75% LTV.

    Frequently Asked Questions

    How does the base rate affect my mortgage payments?

    The base rate affects the interest rate on variable rate mortgages. If the base rate increases, your monthly payments will likely increase as well. For example, a 0.25% increase in the base rate could add approximately £25 to the monthly payments on a £200,000 mortgage.

    What is the current base rate?

    As of April 2026, the Bank of England base rate is 3.75%.

    What is a remortgage?

    A remortgage is when you switch your current mortgage to a new deal, either with your existing lender or a different one. This could potentially save you money if the new mortgage has a lower interest rate than your current one.

    What is loan-to-value?

    Loan-to-value (LTV) is the ratio between the amount of your mortgage and the value of your property. For example, if you have a £180,000 mortgage on a £200,000 property, your LTV is 90%.

  • UK House Price Growth Increases to 3% in April 2026: Impact on Mortgage Payments

    UK House Price Growth Increases to 3% in April 2026: Impact on Mortgage Payments

    As of April 2026, the UK has witnessed annual house price growth rise to 3.0%, up from 2.2% in March. This increase, coupled with the current base rate of 3.75%, has implications for various mortgage scenarios, including first-time buyers, remortgagers, and landlords.

    Impact on First-Time Buyers

    House Price Growth and Mortgage Payments

    For a first-time buyer purchasing a property at the current average price of £1700 more than last month, the mortgage payments will be affected. Assuming a 90% loan-to-value (LTV) ratio and a 25-year term, the monthly repayment on a £250,000 mortgage is approximately £1,311. With the 3% house price growth, the mortgage amount increases to £257,500, leading to a monthly repayment of £1,349, an increase of £38 per month.

    Impact of Base Rate on Mortgage Rates

    With the current base rate at 3.75%, first-time buyers may see a slight increase in their mortgage rates. For instance, a 0.25% increase in the mortgage rate from 2.75% to 3.00% on a £250,000 mortgage over 25 years would increase monthly payments from £1,153 to £1,186, a £33 monthly increase.

    Effect on Remortgagers

    House Price Growth and Equity

    For homeowners looking to remortgage, the 3% annual house price growth could mean increased property equity. For a property purchased at £200,000 a year ago, the value would now be £206,000. This increase in property value could potentially lower the LTV ratio, resulting in more favourable remortgage rates. For example, if the LTV ratio drops from 75% to 70%, the monthly payment on a £200,000 mortgage over 20 years could decrease from £1,084 to £1,040, a saving of £44 per month.

    Impact of Base Rate on Remortgage Rates

    With the current base rate at 3.75%, remortgagers may also see a slight increase in their mortgage rates. For instance, a 0.25% increase in the mortgage rate from 2.75% to 3.00% on a £200,000 mortgage over 20 years would increase monthly payments from £1,084 to £1,109, a £25 monthly increase.

    Implications for Landlords

    House Price Growth and Rental Yield

    For landlords, the 3% house price growth could potentially increase rental yields. For instance, a property purchased for £200,000 a year ago could now be worth £206,000. If the monthly rent were to increase proportionally by 3%, a landlord charging £800 per month could increase the rent to £824, an additional £288 annually.

    Impact of Base Rate on Buy-to-Let Mortgages

    With the current base rate at 3.75%, landlords may see an increase in their buy-to-let mortgage rates. For example, a 0.25% increase in the mortgage rate from 2.75% to 3.00% on a £200,000 interest-only mortgage would increase monthly payments from £458 to £500, a £42 monthly increase.

    Frequently Asked Questions

    How does house price growth affect my mortgage payments?

    Higher house prices mean larger mortgage amounts, leading to higher monthly repayments. For example, a 3% increase on a £250,000 property results in a £7,500 higher mortgage amount.

    How does the base rate affect my mortgage?

    The base rate influences the interest rates lenders charge on mortgages. A higher base rate often leads to higher mortgage rates. For example, a 0.25% increase could add £33 to monthly repayments on a £250,000 mortgage.

    How does house price growth affect remortgaging?

    Increased house prices can boost your property equity, potentially lowering your loan-to-value ratio and enabling access to more favourable remortgage rates.

    What is the current base rate?

    The current base rate, as set by the Bank of England, is 3.75% as of April 2026.

  • UK Mortgage Rates Dip for First Time Since War Outbreak

    UK Mortgage Rates Dip for First Time Since War Outbreak

    As of 17th April 2026, the UK mortgage market has seen a week-on-week decline in average fixed rates for the first time since the outbreak of the war in Iran. The latest data from Moneyfacts reveals a drop in the average three-year fix by 5bps to 5.5%, the average two-year fix by 3bps to 5.87%, and the average five-year fixed rate by 2bps to 5.76%.

    Significant Reductions in Some Product Categories

    Some product categories experienced more significant reductions. Average three-year fixes at 95% loan-to-value (LTV) fell by 13bps to 5.98%, and at 85% LTV, they dropped 9bps to 5.53%. Average two-year fixes at 70% LTV were also down by 9bps to 5.58%, and at 95% LTV, they fell 8bps to 6.4%. This downward trend is a positive shift for borrowers, especially those with smaller deposits.

    New High LTV Deals and Rate Cuts by Major Lenders

    Building societies have introduced a number of higher LTV deals, including new products at 98% LTV from Cambridge Building Society and 95% LTV ranges from Saffron Building Society and Leeds Building Society. Major lenders such as HSBC, Lloyds Bank, and Santander also reduced rates during the week. Other lenders, including Atom Bank, Halifax, TSB, and The Co-operative Bank, followed suit, while Kensington and Principality Building Society increased rates.

    Market Outlook

    Moneyfacts personal finance expert Rachel Springall notes that the rate reductions are a small yet positive step in the right direction. This trend follows recent swap rate moves, which are currently around 4%. Prior to the recent ceasefire in the Middle East, there were speculations of an interest rate hike by the Bank of England due to a projected increase in inflation this year. Borrowers will be keen to see if this positive momentum in rate cuts and new deal launches continues. Looking ahead, it will be interesting to see if Barclays, which has not adjusted its residential mortgage rates since the start of April, will decide to cut rates next week.