The Bank of England has once again been in the spotlight this month, but the story for mortgage borrowers has been more complicated than a single base rate decision.
Bank of England Holds Rates
At its September meeting, the Monetary Policy Committee (MPC) voted to hold the base rate at 4%. This was widely anticipated, with Governor Andrew Bailey signalling that while the fight against inflation continues, the Bank wants to avoid cutting rates too quickly and risking a resurgence in price pressures.
The decision means that, for now, the base rate remains at its lowest level since 2022, but expectations are growing that further cuts could come in 2026 if inflation continues to ease.
Mixed Moves from Lenders
Despite the base rate pause, lenders have been busy repricing their ranges, and not always in the same direction:
- HSBC increased rates by up to 0.20% on some deals, even while Aldermore and Gen H cut prices in certain segments.
- Nationwide raised selected fixed rates by up to 0.20%, but later announced fresh cuts across its mortgage range as market conditions shifted.
- TSB and Co-op Bank repriced upwards, while Barclays moved in both directions across different products.
- On the positive side, buy-to-let fixed rates have fallen to their lowest since 2022, giving landlords some relief after a turbulent couple of years.
This patchwork of moves reflects the tug of war between funding costs and competitive pressure.
Why Are Rates Still Rising in Places?
The answer lies in the broader economy. Gilt yields — a key driver of mortgage funding costs — hit their highest level in 25 years this month, creating upward pressure on some mortgage products even as the base rate holds steady.
That’s why some lenders are trimming rates while others are pushing them up — each is responding to different pressures in the wholesale funding markets.
Support for First-Time Buyers
There was some good news for those trying to get on the ladder. HSBC raised its loan-to-income (LTI) cap for first-time buyers, giving some households extra borrowing power in a competitive market.
Our Thoughts
This month’s story is a reminder that mortgage rates don’t move in lockstep with the base rate.
Even with the Bank of England holding steady at 4%, borrowers are seeing a mixed picture: some product ranges are cheaper, others more expensive, and market conditions can change quickly.
The good news is that competition is alive and well, particularly in areas like buy-to-let and certain residential fixes. For first-time buyers, higher LTI limits may help improve affordability.
The less positive news is that wholesale costs (like gilt yields) remain volatile, which means rates could continue to move around in the short term.
For anyone remortgaging or buying this autumn, the key takeaway is clear: act early, review your options, and be ready to move when the right deal comes up.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Information correct at time of writing – September 2025.
Easy Street Financial Services Limited is authorised and regulated by the Financial Conduct Authority. FCA No. 1013595.




