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February 10, 2010    

Tracker rates hit record lows

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by Gill Montia

Tracker rates fell to record lows in January, Bank of England statistics have revealed.

For those with a 25% deposit, the rate on the average tracker deal declined to 3.63%, down from 3.92% in December.

The shift indicates that competition is hotting up, given that the base rate has now been maintained at 0.5% for eleven consecutive months.

Furthermore, the average rate on a two-year fix fell slightly to 3.97% last month, while the typical five-year fixed-rate saw a 0.12% decline between December and January, to 5.55%.

The outlook is promising for all but those with small deposits, who are stuck with substantially higher rates.

However, Countrywide Mortgages has reported that lenders have recently launched a batch of new high loan-to-value (LTV) deals, aimed at first-time buyers.

According to the broker, a number of high LTV home loans appeared its top ten mortgages list in January, with four of the deals sporting LTVs of up to 90%.

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