Barclays cuts rates on 80 per cent LTV loans

Barclays has reduced rates on its Woolwich mortgages (80% LTV) by up to 0.21% and at the same time has introduced a drop lock facility for all new mortgage customers.

The key reductions across the 80% LTV range include a cut of 0.21% on a two year fixed from 4.59% to 4.38%, 0.10% reduction on the three and five year fixed rates (three year 4.89% to 4.79% and five year 5.49% to 5.39%).

At the same time a lifetime tracker at 80% LTV is being introduced at base plus 3.38% with a £999 application fee.

The drop lock facility will be available to all new tracker and offset borrowers with Barclays. It will allow people who opt for a tracker or offset mortgages to switch to a fixed rate in the future without incurring an early repayment charge.

Andy Gray, head of mortgages for Barclays, said: "With speculation this week that UK interest rates are set to stay at record lows until 2014, the drop lock facility provides customers with peace of mind that they can go into a low tracker rate now and switch at a point in the future when they need greater security.”

This is the second rate reduction in a row for 80% loan to value deals and will be welcomed by those with smaller deposits.

It also follows on from the announcement last month that Barclays is offering mortgages at 90% lending for customers buying a new Bovis Homes property. The deal for consumers purchasing from Bovis Homes is maintained at a rate of 4.99% for two years.

All fixed rate mortgages revert to a lifetime tracker rate at base plus 2.49% after the fixed rate period.