Santander updates its affordability calculations following Bank of England base rate cut

19 February 2025

Santander UK has today announced it has reduced its residential affordability rates, following the Bank of England’s base rate cut in February.

The updated calculations take into account a reduction in residential affordability rates by 0.25%, as well as updated household expenditure figures, making it easier for customers to borrow more.

Brokers can input their clients’ details into Santander’s affordability calculator to see how the reductions affect them.

Last week, Santander became the first high-street mortgage lender to offer a sub-4% mortgage in 2025. Eligible customers can now apply for one of four new products, as the lender launched a range of two- and five-year fixed, 3.99% residential purchase and remortgage rates, at 60% LTV.

The new products and rate changes follow the lender’s new broker pledges announced for 2025, as it aims to address some of the most common challenges experienced by intermediaries in the market.

The pledges are:

No dual pricing

Brokers will always have access to Santander’s best pricing for purchase, remortgage, and product transfer clients.

Minimum 24 hours’ notice of product withdrawals

Santander understands that withdrawing products at short notice places pressure on brokers and their clients.  
As such, a guaranteed notice period will provide confidence and assurance to recommend Santander products, as well as provide more time for brokers to reach out to clients who may be impacted by the product withdrawal.

Improved product transfer process

Santander is building a transparent and improved product transfer process, including developing new web content to outline the journey.
The lender will help brokers identify when a client’s current deal is coming to an end and update its product maturity letters, directing clients back to their broker when their deal is due to end.