Tracker and SVR mortgage rates fall to five-year low
by Gill Montia
Latest figures from the Bank of England show that rates on new tracker and standard variable rate loans have fallen in recent weeks, however those with less than a 25% deposit remain locked out of the best deals.
Tracker loans are linked to the base rate and at the end of December, the cost of the average two-year tracker with a 75% loan-to-value (LTV) ratio had fallen to 4.95% compared to 5.78% in November.
The average was down to a level last seen in January 2004, having dropped back from a peak of 7.04% in October.
Rates on standard variable loans were down to an average 5.38%, the lowest since November 2003.
Fixed-rate mortgages have also followed the trend; in December, the average rate on a 75% LTV two-year fixed-rate deal stood at 4.79% and for a five-year fixed-rate, 5.31%.
Later round-ups of average rates could be even more appealing because the December figures do not take into account two cuts in the base rate, which is down from 3% in November, to 1.5%.
So far, HSBC, Lloyds TSB and Nationwide are passing on January’s 0.5% cut in full while Halifax and Royal Bank of Scotland have opted to reduce their standard variable rates by 0.25%.
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Tags: average, Bank of England, fall, mortgage, rates, standard variable, tracker