Mortgage deals affected by "low rate environment"

20/08/2009

Tips and hints for consumers looking to get the best mortgage deal have been offered by a financial website.

According to figures from Moneysupermarket.com, the average rate offered on new loans has fallen by 1.3 per cent over the past year.

However, big differences between lenders were highlighted by the research - meaning that borrowers who do their homework can lessen their repayment costs.

Northern Rock was found to have dropped its average mortgage rate by 0.27 per cent.

However, Alliance & Leicester has cut its loan rate by 2.3 per cent.

These changes have been brought about by the fact that the Bank of England has cut its own lending rate to an all-time low of 0.5 per cent over recent months.

Hannah Skenfield, mortgage channel manager at moneysupermarket.com, said: "The Bank of England Base Rate has dropped by 4.5 per cent since August last year, however despite this low rate environment there is a significant disparity in the amount of this saving being passed on to mortgage borrowers by the main UK lenders."

She added: "This further illustrates the divorce between mortgage rates and the Base Rate."

Tags; Housing Debt and Bills, Young Family Finances,

Regional Debt Advice; Debt Advice Enfield, Debt Advice Leicester,

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