December 15, 2009
Mortgage Rates Fall
Despite the Bank Base Rate being held at 0.5% for the ninth consecutive month, many mortgage lenders have started cutting the interest rates they charge on their loans.
In a positive sign for mortgage borrowers, lenders appear to be reducing the margins they make on some deals.
Nationwide Building Society is slashing a number of its interest rates today, while Abbey, Alliance & Leicester and Yorkshire Building Society have all introduced lower rates recently.
And first-time buyers will welcome the news that more lenders are finally starting to offer mortgages at up to 80%, 85% and even 90% loan to value. Moneysupermarket.co.uk calculates that the number of first-time buyer products available is now 18% higher than it was in August.
Hannah-Mercedes Skenfield, mortgages channel manager at moneysupermarket.com said:
"It is encouraging to see an increase in the number of lenders providing suitable options for first-time buyers. If mortgage providers continue to give a helping hand to first-time borrowers, we could see a significant improvement in the housing market."
Nationwide’s fixed and tracker rates will be reduced by up to 0.29% today.
Abbey has cut some rates by 0.2%, Accord by 0.4% and The Post Office has slashed some of its mortgage rates by 1.3%. Alliance & Leicester has reduced some mortgage rates by 0.25%, C&G by 0.1%, Leeds Building Society by 0.26%, Scottish Widows by 0.4% and Yorkshire Building Society by 0.3%.
The best two-year fixed rate mortgage currently available comes from First Direct, priced at 3.64, though applicants will need a deposit of 35% to secure that rate.
Newcastle Building Society has a two-year fix at 3.65%, which only requires a 20% deposit.
Natwest is offering a three-year fix at 4.39% and Leeds building Society has a five-year fixed rate mortgage at 4.75%. both ask for a 25% deposit.
