The race for the best buy mortgage has intensified this week, with Santander, Barclays, Halifax and Nationwide all slashing rates in an effort to offer the cheapest home loan. Santander currently leads the pack with a 3.55% two-year fixed-rate deal available to customers with a 40% deposit. This took it ahead of Barclays, which took as much as 0.3% off its top deals as recently as Tuesday.
Falling rates are not limited to deals that require a big deposit, with Santander offering customers with a 10% deposit a 4.09% two-year fixed-rate deal.
Aaron Strutt of broker Trinity Financial said: "The best rates are still available for those looking to move home. The cost of funding has been coming down and no doubt many of the lenders are trimming their profit margins by offering better rates."
Why are mortgage rates going down?
There are a few contributory factors pushing rates down. One is competition amongst lenders, with a series of big names undercutting each other in a race to top best buy tables and pull in customers.
A second is uncertainty in the housing market, driven by rumours over potential Autumn Budget announcements on stamp duty increases and even a 'mansion tax'. If potential homebuyers are more reluctant to make a move, lenders may try to stimulate the market by reducing mortgage costs.
A third factor is inflation falling for the first time in five months, hardening expectations that the base rate of interest will follow suit. The swaps market is estimating that there is a more than 85% chance of a 0.25% rate cut at the 18th December meeting of the Bank of England’s monetary policy committee (MPC), bringing it down from 4% to 3.75%. Lenders are therefore happier to slash their rates in the expectation that the overall cost of borrowing is about to get cheaper.
David Hollingworth, associate director at L&C Mortgages, said: "The continued downward path for inflation is significant for mortgage borrowers. It’s likely to underline the market’s expectation of a base rate cut in December.
"The growing belief of a cut coming sooner than previously anticipated has already seen mortgage rates improving. Mortgage lenders have been quick to pass on the improved cost of funds and there’s been successive rounds of fixed rate cuts by most major lenders."
What is the best mortgage rate?
The best mortgage rates are usually attached to fixed-rate deals for applicants with a deposit of at least 40%. At the moment, the lowest rates are on two-year fixed-rate deals. A two-year fix is not always the cheapest option, as pricing depends on how the lender expects borrowing costs to change over the term of the deal.
At the time of writing
- Santander is offering a two-year fixed-rate deal at 3.55% for a 40% deposit
- Barclays is offering a five-year fixed-rate deal at 3.72% for a 40% deposit
- Halifax is offering a two-year tracker rate deal at 4.11% for a 40% deposit
- Barclays is offering a five-year tracker rate deal at 4.60% for a 40% deposit
You can find all of the latest top mortgage deals on our 'Best mortgage rates in the UK' page.
These might not seem like great deals to people who locked in their current rate before mortgage costs began to soar in late 2022, but it represents a significant improvement over the last 18 months.
In the table below, you can see how rates have changed since June 2024.
| LTV | Best two-year fixed-rate deal | Best five-year fixed-rate deal | ||
| June 2024 | Nov 2025 | June 2024 | Nov 2025 | |
| 60% | 4.75% | 3.55% | 4.33% | 3.72% |
| 70% | 4.83% | 3.69% | 4.44% | 3.80% |
| 80% | 4.99% | 3.85% | 4.62% | 3.93% |
| 90% | 5.19% | 4.09% | 4.71% | 4.17% |
| 95% | 5.39% | 4.45% | 4.99% | 4.19% |
Figures correct as of 21/11/25 and based on a repayment mortgage arranged over 25 years to purchase a property valued at £350,000
To put this into context, the biggest fall over this period was 1.2%, which on a £200,000 mortgage repaid over 25 years, represents £133.61 per month. This means that while current mortgage rates may seem high when compared with the borrowing costs prior to 2022, the market is improving for borrowers.
Will mortgage rates keep going down?
The obvious answer is that we just do not know. The market expectation is that there will be a base rate cut in December and another at some point next year, but the uncertainty around what will be announced at the Autumn Budget must add a significant caveat to any predictions.
Should the Bank of England cut rates by 0.25% as expected on the 18th December, some mortgage costs will drop immediately, as tracker mortgages will follow the base rate and drop by 0.25% too. This would also apply to most variable deals, but the exact level and timing will be up to the lender.
Most borrowers are on fixed-term deals, where the interest rate remains the same for a set length of time, so would not be directly affected by a base rate cut. When your term is almost up, you will be offered a new rate to renew based on the current mortgage market. Whether this is higher or lower than what you are paying now will depend if you are coming off a long or short fixed-term deal. The cost of a fixed-rate mortgage is benchmarked on swap rates, which reflect market expectations for future base rates.
Some lenders have pre-empted December's potential base rate cut and launched reduced deals already in an effort to get ahead of the market. These providers would be less likely to cut their rates again if the base rate decision is a 0.25% drop. If you're interested in finding out more about where interest rates might go in the future, check out our article on the latest UK interest rate predictions.
How to get the best mortgage rate
As mortgage rates can change from day to day, the easiest way to check for the best current rate is by using our mortgage rate comparison tool. The tool will find some of the best mortgage interest rates available for the amount you need, based on your loan-to-value ratio. Other factors, including your income, outgoings, credit score and borrowing history will affect the mortgage deals that you ultimately qualify for.
We provide specific guidance around finding the best mortgage deals in our articles, 'How to get the best mortgage deal' and 'How to remortgage and get the best rate'.
To get the best mortgage rate for your specific needs, you could speak with a mortgage broker who, ideally, has access to the whole mortgage market. Mortgage brokers not only have expertise in understanding how to get the best mortgage rates for your circumstances, but they can also access deals that may not be directly available to consumers.
You can either source a vetted mortgage professional locally using VouchedFor* (also read our article on 'How to find a mortgage broker you can trust') or you can get in touch with the online mortgage broker, Habito*, which has access to deals from over 90 mortgage lenders.
If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. The following link can be used if you do not wish to help Money to the Masses or take advantage of any exclusive offers - Habito, Vouchedfor
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