The Co-operative Bank has caused a real stir in the media this week as it launches a three year tracker mortgage deal that has gone straight to the top of tracker rate best buy tables.

The tracker mortgage is just 1.89 per cent over the Bank of England base interest rate with a £995 application fee. Unlike many other mortgage lenders, the deal is not purely reserved for those with a 40 per cent deposit or equity either but requires only a 25 per cent deposit or equity.

The deal knocks First Direct off the top spot by 0.5 per cent, which has held the position for some time.

It seems that slowly but surely mortgage lenders are relaxing their criteria. The Co-operative Bank also announced its three year, fee-free fixed rate mortgage is also being reduced by 0.2 per cent to 4.89 per cent, although that one is still only available with a 40 per cent deposit.

The number of mortgages available for those with lower deposits is increasing and competition is slowly returning to the mortgage market, albeit perhaps a little too slowly for the liking of some.

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