04.09.08 by Andrew Montlake

Magical 5% Mortgage Rate Barrier Breached!

More good news!

A few weeks ago, you would have had me sectioned if I’d said lenders would very soon be falling over themselves to cut residential mortgage rates and be offering products below the magical 5% mark. The men in white suits would have whisked me off in no time.

Well, quite staggeringly given the doom and gloom of late, we are now seeing both fixed and tracker products coming out with rates starting from 4.99% with larger fees and 5.49% with more reasonable fees.

The cuts are set to continue even without a helping hand from the Bank of England.

Abbey is set to cut its rates even further on Friday, probably by around a quarter of a per cent, which will undoubtedly spark another wave of similar moves from the mighty HBOS and Nationwide.

All this is fabulous news for consumers and it will be interesting to see just how far lenders are prepared to go. Could 4.99% and below become the norm?

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