Mortgage Market Splits in Two: Some Lenders Cutting Rates, Others Still Rising

Anyone shopping for a mortgage this week is facing a confusing picture: some of the country's biggest lenders are cutting rates while others are still pushing them up, all in the space of a few weeks.

The cuts

Barclays reduced rates across its residential purchase and remortgage ranges from 9 July 2026, with cuts of up to 0.66 percentage points at the higher loan-to-value tiers. Its fee-free 90% LTV two-year fix, for example, dropped to 4.79%, while a 60% LTV two-year remortgage fell from 4.54% to 4.39%.

Dudley Building Society went further, cutting rates by up to a full percentage point across its residential, buy-to-let, holiday-let and expat ranges. Its residential standard two-year discount at 90% LTV fell from 6.15% to 5.40%, and its expat two-year fix at 85% LTV dropped a full point to 5.50%.

The rises

At the same time, other lenders have been repricing upward. Earlier in July, NatWest, Nationwide, Virgin Money, Barclays and Coventry all hiked selected fixed rates as swap rates — the wholesale cost lenders pay to fund fixed-rate deals — rose on the back of Middle East-driven oil price volatility. According to Uswitch's daily tracker, the average Standard Variable Rate (SVR) for remortgages sits just below 6.49%, a costly default for anyone who lets their deal lapse without switching.

Why the split is happening

Lenders aren't moving in lockstep because they're competing on different things. Smaller building societies like Dudley often cut rates to win market share in niche products (expat, holiday-let, buy-to-let) where they face less competition. Larger high-street lenders are more sensitive to swap-rate movements and the Bank of England's 30 July decision, where the base rate has sat at 3.75% since December 2025 but two MPC members voted for a hike at the last meeting.

What this means for you

• If you're remortgaging soon: rate moves are happening fast in both directions — a deal that looked good last week may already be gone or repriced. HomeOwners Alliance's best rates tracker updates regularly and is worth checking the morning you apply.
• If you're on an SVR: the gap between the average SVR (6.49%) and the best fixes (from 3.99% on a tracker) is wide enough that switching is almost always worth exploring, even with an early repayment charge on your current deal.
• If you have a niche circumstance (buy-to-let, expat, holiday-let), smaller building societies may currently offer sharper pricing than the big banks.

International comparison

Rate volatility isn't unique to the UK. In the US, 30-year fixed mortgage rates have swung with Federal Reserve policy expectations through 2026, while in Australia, the Reserve Bank's cash rate decisions feed through to variable-rate mortgages (the dominant product there) almost immediately — a faster transmission mechanism than the UK's fix-heavy market.

Key Numbers

• 4.79% — Barclays' fee-free 90% LTV two-year fix after its July cut
• 6.49% — average remortgage SVR, per Uswitch
• 3.75% — Bank of England base rate ahead of the 30 July decision

Sources

• Barclays cuts residential mortgage rates across key products — The Intermediary
• Dudley BS cuts rates by up to 100bps — Mortgage Solutions
• UK mortgage rates and product changes, week ending 3 July 2026 — Mortgage Introducer
• What are the current UK mortgage rates today? — Uswitch
• Best Mortgage Rates — HomeOwners Alliance

Educational content only — not financial advice.