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Barclays has become the first major bank to bring back a mortgage deal with rates below 4 per cent, since the surge in swap rates caused by the Iran war.

The deal offers a rate of 3.96 per cent for a two-year fixed period – but it’s only available to its premier customers.

A host of lenders removed hundreds of products from the mortgage market as a result of the conflict, with all deals with rates below 4 per cent quickly wiped out. That left homeowners and new buyers who had not yet locked in a rate faced with higher prospective repayments.

After a volatile few months, swap rates, which mortgage products tend to be based on, have stabilised, and some lenders have begun to lower rates once more.

Barclays has followed suit by cutting rates on new purchase and remortgage products, including a two-year tracker mortgage for new home purchases with a 75 per cent loan-to-value rate. This holds an interest rate of 3.96 per cent and carries a £999 product fee.

As it is only for Premier customers, to qualify, applicants must have a current account and either pay £75,000 in income annually or have at least £100,000 in savings, investments or a mix of both held with Barclays.

For remortgage deals, the best rate on these newly altered products is 4.8 per cent on a five-year fix, also carrying a £999 product fee.

Experts encourage homeowners to seek guidance for their specific circumstances if they are approaching a renewal date, with 1.8 million people set to need a new deal during 2026.

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Owners can typically secure a new deal with six months left on their old deal, and the headline interest rate is not always the most important part of the equation when it comes to choosing the right deal. Product fees range from provider to provider, and the length of the mortgage term is also important to consider.

Paul Heywood, chief data officer at Equifax UK, noted that British households are paying half again on top of previous repayments compared to four years ago, with further interest rate price rises possible across the course of 2026.

“Average monthly repayments for new mortgage lending remain 50 per cent higher than in January 2022, and this is now compounded by central bank policymakers under pressure to address inflation and the impact of the ongoing conflict in the Middle East. This could spell disappointment for any borrowers hoping for a base rate cut,” he said.

The near-term path of interest rates remains uncertain, and mortgage deals will mirror that, with Barclays raising the rates on some products even as it brings the first sub-4 per cent deal back to market too.