Tracker mortgages 'have fallen in price'

Tracker rates fell to a record low during January, offering a boost to consumers seeking cheap mortgage rates.

According to the Bank of England – which began keeping records on the product in 1997 – the average rate charged on such deals fell from 3.92 per cent to 3.63 per cent last month.

Fixed-rate deals also became more affordable, with two-year loans falling to an average of 3.97 per cent and five-year deals dropping by 0.12 per cent to 5.55 per cent.

The decrease in prices has been attributed to increased competition in the mortgage market since the turn of the year.

A 26 per cent increase in the number of deals available on a 90 per cent loan-to-value basis has also been witnessed, the Bank of England reported.

Earlier this week, Moneyfacts said there were 144 mortgages requiring a ten per cent deposit at the start of February, compared to 114 at the beginning of the year.

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2010-02-10 13:33:12 © Moneyextra.com