Quick links to latest articles:

Cost of fixed-rate mortgages continues to drop

By Matthew Plant - Financial specialist

10 June2010

According to figures from the Bank of England, the cost of short-term fixed-rate mortgages dropped to a record low in May, as `competition continued to return to the market`, The Telegraph reports.

The average rate charged on a two-year fixed-rate mortgage for someone with a 25% deposit fell to 3.8% during May.

Interest rates charged on two-year fixed-rate mortgages have gradually dropped since September last year, when they were at 4.47%. They have now fallen to their lowest level since 1995 - when the Bank of England`s records began.

Meanwhile, the cost of servicing a five-year fixed-rate mortgage (for people with a 25% deposit) also fell during the month - dropping from 5.5% to 5.39%, reaching their cheapest level since May 2009.

Spokesperson for Moneyfacts.co.uk, Darren Cook, said: "The fact that rates are coming down is good news for borrowers. Lenders are more comfortable with the new landscape of the mortgage market, and we are seeing an appetite to lend and compete against each other on best buys, something we haven`t seen in the market for some time."

Fill in our form to find your mortgage solution

About your mortgage
Purpose:
Amount required:
Your information
Title: First name: Surname:
Telephone 1: Telephone 2: Email:
By continuing, I agree to the privacy policy

Tags: fixed rate, mortgage, fixed rate mortgage, cost, cost of mortgage

Fees payable when continuing service is provided. Repaying debt over a longer period may increase the total amount to be repaid. Calls are recorded and are usually free from UK landlines. Mobile phone users may be charged and should check with their service provider. Cards are provided by third parties and are subject to eligibility, status and terms and conditions. Applicants must be UK residents aged 18 or over.

All About Money Limited © 2013. All rights reserved. 42 Boston Rd, Sleaford, Lincolnshire NG34 7ER.