Atom bank has announced a fresh round of rate cuts across its near prime mortgage range.
Effective immediately, the digital bank has reduced pricing by 0.10% on selected two- and three-year fixed rate products up to 85% loan-to-value. The move brings starting rates to 5.39% for two-year fixes and 5.24% for three-year fixes. Rates on five-year products remain unchanged, starting at 5.14%.
The decision marks the latest in a series of rate reductions during 2025 aimed at easing the cost of borrowing for those with a less-than-perfect credit profile. Atom has also reported that more than 70% of its near prime customers have successfully transitioned onto Prime mortgage products over the past 12 months, underlining the lender’s policy of upgrading borrowers at maturity if their credit position has improved.
Richard Harrison, head of mortgages at Atom bank, said the latest changes would be welcomed by brokers and borrowers alike. “We are determined to provide borrowers with great value, even if they have experienced a temporary payment blip in the past,” he said. “Combined with our market-leading speeds and flexible criteria, Atom bank’s near prime proposition is striking a chord with brokers.”
Earlier this year, the lender increased the maximum LTV for near prime mortgages to 90%, building on a string of criteria enhancements made in 2024. These included doubling the threshold for unsatisfied defaults to £2,500 and shortening the look-back period for defaults from three years to two.
The impact of these changes has been notable, with April 2025 seeing record volumes of near prime applications. Atom attributes this surge to the combination of improved criteria and successive rate cuts, which have made the product range more competitive for borrowers seeking to rebuild their financial profile.
“We are really proud of the fact that the majority of our near prime customers have qualified for a Prime product at maturity in the last year,” he said. “We continue to provide a clear path back to Prime status for those borrowers who have suffered a temporary credit blip, ensuring that they get back on a sound financial footing when the time is right.”
