The Abbey is reducing its mortgage interest rates yet again, as have many mortgage lenders in recent weeks.
The mortgage lender is reducing the mortgage rates for their new borrowers on their two, three and five year fixed rate mortgage deals by up to 0.3 percent from today, however, first time buyers will still need to find quite large deposits in order to receive the best mortgage deals available.
According to a spokesperson from the Abbey, fixed rate mortgages are continuing to grow in popularity.
Mortgage lender Lloyds TSB has just announced its fifth mortgage interest rate cut in less than one month and the Halifax has also been consistently dropping the interest rate on its new mortgage deals. Mortgage interest rates have now returned to the levels we were seeing before the beginning of the credit crunch as interest rates on a typical two year fixed rate mortgage peaked at 7.08 per cent back in July and are now back to 6.39 per cent.
Unfortunately, the costs associated with a mortgage remain high as arrangement fees are still higher than last year and borrowers are still having to find a large deposit, although at least there is some temporary respite for those looking at houses with a property value of less than £175,000 now that the government has given a twelve month holiday on the 1 per cent stamp duty tax band.
The mortgage squeeze has resulted because lenders have been restricting the levels of borrowing between each other, however, the Bank of England intervened in April this year with a special liquidity scheme, which allowed the banks to exchange £50 billion of mortgage for government bonds.
The liquidity scheme is due to end in October, however, the Council of Mortgage Lenders (CML) has appealed to Chancellor Alistair Darling to either extend or renew the scheme in order to counter market uncertainty.
News such as this is great for those considering CeMAP training as any assistance given to the housing market can only boost the business of mortgage advisors further.
