Lenders cut selective mortgage rates

Posted under General by Alan

Halifax, one of the biggest mortgage lenders of the UK, has announced another rate cut. For borrowers who can deposit minimum of 25% of the property value, the tracker-rate or fixed deal rates are lowered by an average 0.25%. The deals must be arranged through brokers to obtain the cut rates.

The announcement marks the continuation of trend prevailing in recent weeks, where lenders have been offering small reductions to bring headline rates to the 6% level or below. You can get rates below 6% if you have the capacity to deposit large lump sums of money.

According to Halifax spokeswoman, it is passing on the benefit of cut in swap rates to the borrowers. Swap rate is the borrowing cost between banks.

Other lenders such as nationalised Northern Rock, Yorkshire Building Society and New Castle Building Society, have cut the costs on certain deals.

According to Ray Boulger, of John Charcol mortgage broking, lenders have offered cuts only on selective deals, not on every deal.

The Britannia Building Society and Coventry are offering the best deals to borrowers who can afford to deposit a minimum 50% of property’s value.

Boulger thinks that lenders are relaxing their lending policy and more lenders are likely to offer still cheaper fixed rates in the next few weeks.

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