Homeowners have been dealt a rare boost with news of falling interest rates on fixed rate mortgages . Financial information website Moneyfacts.co.uk has revealed that the average interest rate charged on a two year fixed rate mortgage has dipped below 5 per cent for the first time in nearly six months. The price drop is the result of increased competition for business among lenders, according to Moneyfacts. Borrowers will be hoping other forms of credit such as personal loans and credit cards will also benefit from a reduction in interest rates in the coming months.
Spokesperson Michelle Slade commented that swap rates had begun to fall, and although two year fixed rate home loans have begun to benefit, the majority deals are yet to see the benefits passed on. There are signs, however, of lenders reducing their credit criteria and displaying fewer signs of caution. The announcement could spell good news for first time buyers, with lenders likely to accept less sizeable deposits in the coming months.
Meanwhile, price comparison website Moneysupermarket.com suggested that people are still opting against remortgage deals, and instead are reverting to standard variable rate deals. Interest rates on such deals have risen in recent months, and a typical loan is now accompanied by an interest rate of 4.7 per cent, despite the base rate standing at 0.5 per cent.
Rates Dip Below 5 per cent on Fixed Rate Loans
Rates Dip Below 5 per cent on Fixed Rate Loans
Mon, 23 Nov 2009
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