Customers chase record low rates

Fixed rate and tracker mortgages for both purchases and remortgages have become significantly cheaper, with most lenders becoming much more competitive of pricing.

Lenders are primarily targeting the first-time buyer and remortgage market.

Figures from the Bank of England also reflect that mortgage rates across two, three and five year terms were at their lowest level over the past 6 years.

Nigel Stockton, financial services director at Countrywide, said: “Despite the ongoing pressures on lending institutions and the UK economy as a whole, we continue to see some of the cheapest ever remortgage fixed rate products being offered, with some 2-year rates on offer currently as low as 2.54%.

“Overall, the proportion of homeowners considering moving from their variable rate mortgage has subsided as the threat of rate rises has weakened. However, budgeting continues to be an area of key concern for home movers, which makes some of the competitive remortgage products currently available - particularly at the lower loan-to-value, 60% LTV and below levels - much more of an attractive option.”

The report was compiled from the average interest rates applied for by Countrywide’s customers.