11.11.08 by Andrew Montlake

Competitive Mortgage Rates Are Back !

I apologise for the sudden outbreak of positivity, but would you believe it there are suddenly some very competitive mortgage rates around from as low as 4.49%?

The good news is they are not just fixed rates but even tracker products have made a much quicker return than even the most positive predicted.

After the spectacular rate cuts we saw in the last two months, knocking off 2% from the Bank of England Base Rate, full marks go to two mainstream lenders for releasing new products quicker than anticipated.

Two year fixed rates are now available from 4.49% with free legals and a free valuation for mortgages, whilst 5 year fixes start at 4.89%. Both these products have realistic fees attached at £995.

As far as tracker rates are concerned, and these lenders do not have a collar in their small print, they are available from 4.79%.

The funny thing, well not that funny, is that whilst these rates are undoubtedly eye-catching and will be a welcome relief to many worried about remortgaging, it shows that lenders margins have suddenly increased dramatically.

Who would have thought that 1.79% above Bank Base would be a market leading rate? This shows there are still some issues although 3 month LIBOR has reduced significantly.

What is important however, is that these rates, regardless of the spread, offer a real option to many. Historically speaking, rates that start with a 4 are not to be sniffed at, and with property prices falling to a more affordable level, the biggest issue has been the supply of mortgages at a good rate.

We are all aware of the wider economic issues, but where housing is concerned, once people begin to think that property AND the mortgage are at realistic and affordable levels I expect more to start to take the plunge.

After all, many do not want to miss the bottom of the property market, and I still believe that those that buy any time from now for the next 6 months will be sitting pretty in 5 years time.

View our current Best Buys here.

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