NatWest and RBS cut rates

NatWest and the Royal Bank of Scotland (RBS) have announced they are to cut interest rates on their most popular mortgage products.

From April 30th the interest rates on two-year and five-year fixed rate products will fall by between 0.10 and 0.30 per cent.

"While 2008 has seen a shrinking mortgage market, we have actually increased the amount we have lent by 18 per cent and plan to continue this trend for the rest of the year," explained Paul Geddes, chief executive of consumer banking at RBS.

"Today we are launching two initiatives to build on this - one to help borrowers looking for a new mortgage and the other for those saving for the deposit on their first home."

A five-year fixed rate deal for a buyer looking to purchase a home will now have a repayment rate of 5.89 per cent, a cut of 0.30 per cent.

A fee of £999 will also be attached, with a maximum loan-to-value (LTV) of 75 per cent.

The same product for a borrower looking to remortgage will attract a rate of 6.09 per cent, with a similar fee and LTV.

A two-year fix, with a 75 per cent LTV will see a 0.10 per cent cut to 5.79 per cent, while a 90 per cent LTV will see a similar size cut to 6.09 per cent.

Both have a fee of £999.

At the same time, RBS offering first-time buyers the First Home Saver Account which offers tax-free cashback of up to £5,000 upon completion of a RBS mortgage (worth the equivalent of £8,333 for a higher rate tax payer).

"In these uncertain times, we are giving practical support by providing lower rates on all our new fixed and tracker mortgages. At the same time we are offering a savings product that delivers a generous tax-free reward for saving towards a deposit on a first home," concluded Mr Geddes.

Chris O'Toole