Now fixed rate mortagages even cheaper

Now fixed rate mortagages even cheaper

Interest rates may be rising but some lenders are cutting the cost of their new fixed rate mortgages. Britain's biggest mortgage lender Halifax this week said its two- and five-year fixed rate deals have been reduced by up to 0.16% - but they still look pretty pricey in many cases.

A remortgage customer borrowing up to 80% of the property's value can get a Halifax five-year fix at 5.69% (down from 5.85%). The new two-year fixed rates for remortgagers start at 5.29%. For people moving home the equivalent rates on offer are lower - 5.39% for the five-year fix and 4.79% for the two-year.

However, there are cheaper deals around than these. Rotherham-based mortgage broker Mortgage Talk likes Alliance & Leicester's new five-year fix: 5.15% until January 31, 2009. Minimum deposit is 5% and there are early redemption penalties only within the fixed period - but there is a whopping £595 arrangement fee. Britannia building society is offering a fixed rate for two years at 4.19%. The fee is £499.

If you're after a discounted rate deal, Mortgage Talk says Nottingham building society offers a five-year discount where the current pay rate is 3.83%. There is a £295 arrangement fee. A&L has a five-year deal with a 1.86% discount off the standard variable rate, giving a current pay rate of 3.93%. You can borrow up to 95%, there are no overhanging redemption penalties and the fee is £345.

On Monday, meanwhile, a popular tax loophole,.....continued below

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which allows people to reduce their stamp duty bill by paying over the odds for fixtures and fittings, is being closed, points out London online estate agent Halfapercent.com. "Charging £20,000 for an oversized wardrobe, a towel rail and a lampshade simply won't wash under the new Inland Revenue restrictions," it adds.

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