There were 49% fewer house purchase loans in January than in December, but only 15% fewer remortgage loans, according to data released today by the Council of Mortgage Lenders.

This emphatically demonstrates the effect on the mortgage market of the end of the temporary stamp duty holiday in December, the CML says.

The number of mortgages available has gone up by 6% over the past month, according to the financial information service Moneyfacts.

There were 1,798 mortgage deals requiring deposits of up to 40% on offer at the beginning of March - 68% more than a year ago.

The number of mortgages approved fell by 17% in January, according to figures from the Bank of England.

The total of 48,198 was the lowest number for eight months - but still 43% higher than in January last year.

There are 2,716 mortgage products currently available - a 14% increase since the beginning of the year, and the highest number since May 2009, according to moneysupermarket.com.

At the same time there has been a 98% increase in the number of mortgages available at 85% loan-to-value (LTV) in the past year: from 206 in February 2009 to 404 now.

Mortgage lending in January was relatively weak, some 17.5% lower than a year ago, the British Bankers’ Association (BBA) reports today. This was a reaction to the inflated December market and the adverse weather conditions which impacted on activity.

Lending was boosted in December as borrowers pushed through transactions ahead of the removal of stamp duty relief.

There could be a second credit crunch next year, when mortgage lenders have to start paying back the money they borrowed from the Government to bail them out the first time around.

The result could be that the timidly reviving housing market – prices went up 3.2% in the four weeks to 6 February, according to the Rightmove website - would plummet again.

The Monetary Policy Committee (MPC)’s decision to leave the Base Rate unchanged at 0.5% and not to extend its Quantitative Easing (QE) programme has implications for the mortgage market, according to Ray Boulger of independent mortgage adviser John Charcol.

"We are now around four months into the trend of mortgage rates gently falling, with lenders generally cutting just some of their fixed and tracker rates, rather than most or all their products, at any one time.

Standard variable rate mortgages range from a high of 12.5% charged by Cheshire Mortgage Corporation to a low of 2% from Direct Line, according to research by Largemortgageloans.com. The industry average is 4.79% across 62 lenders.

GE Money Home Lending’s igroup charges the second highest SVR at 8.59%, while Lloyds, Nationwide and Cheltenham & Gloucester are joint second lowest at 2.50%.

The Financial Services Authority (FSA) has published new rules designed to protect homeowners from being charged excessive penalties by lenders when they fall into arrears with their mortgages.

The FSA is also insisting that lenders must only consider repossessing a property as a very last resort.

"Whilst the split between variable and fixed, at face value, seems dramatic, it is really no surprise, as it is absolutely our belief that the best value lies in tracker rates at present.  With the average difference between the best fixed rates and the initial rate on the best trackers around 1.5% in favour of trackers, it will currently take a substantial rise in bank rate for a borrower who takes a tracker to be worse off than one who opts for a fixed rate," said Ray Boulger of John Charcol.

Woolwich, which is owned by Barclays, is tomorrow, 20 January, reducing rates on its tracker range by up to 0.20 percentage points - its sixth rate reduction in a row.

The range includes lifetime trackers at up to 70% loan-to-value at either 2.63% (Barclays base rate + 2.13%) with a £999 fee or 2.99% without fee, and lifetime trackers at up to 75% LTV at 2.89% (Barclays base rate +2.39%) with a £999 fee, or 3.19% without fee.

Mortgage approvals in November were at their highest level since March 2008, according to Bank of England figures.

A total of 60,518 mortgages were approved for house purchases, compared with 57,718 in October.

The number of mortgage products available has grown by 13% since August, when they reached their lowest point, according to moneysupermarket. However, the total number available is still 27% down since the start of the year.

In January 2009 there were 3,384 mortgage products available. This fell to a low of 2,182 in August, and has since steadily risen to 2,430. The most significant growth has been in 85% Loan to Value (LTV) products, which have grown by a third since January.

Gross mortgage lending totalled about £12bn in November, down 10% from the £13.3bn recorded in October, and its lowest level since May, according to the Council of Mortgage Lenders (CML).The total was 14% less than the £13.9bn lent in November last year.

A modest seasonal decline between October and November is typical, although the 10% fall is a little larger than normal. The underlying story, though, is one of market conditions holding steady and the CML does not expect this position to change much in the coming months.

The popularity of fixed-rate mortgages declined even further in November, according to mortgage adviser John Charcol: just over a fifth of the company’s clients - 21.3% - chose a fixed rate.

That was five percentage points lower than the October figure, and most clients who opted for a fixed rate took a 2-year fix, with nearly all the rest choosing a 5-year deal.

From today, 11 December, Abbey is lowering some of its fixed rate mortgage range, and will also launch new three year and five year fixed rate mortgage products, available through both Abbey and Alliance & Leicester branches.

- New three year fixed, 75% LTV mortgage with a £995 booking fee at 4.29%, available to remortgage customers who complete before the 26 February 2010. This product offers a 0.10% discount to the standard three year fixed remortgage product.

The Post Office has reduced the interest rates on its two of its fixed-rate mortgages and its tracker, with immediate effect.

All the mortgage products have a fixed arrangement fee of £599, and the revert rate, which borrowers switch to after their initial rate expires, is currently 2.49%. 

HSBC has decided to drop its arrangement with John Charcol whereby the mortgage broker offered whole-of-market advice to customers visiting HSBC branches.

The experiment, launched in 20 branches in March this year, comes to an end on 18 December, despite being successful and popular with customers.

The number of mortgage deals on offer increased by 5%, to 1,425, over the past month, according to the financial information service Moneyfacts.

This makes the highest number on offer since December last year.

Mortgage approvals for house purchases rose to 57,345 in October, about 1,000 more than the previous month and 18% higher than a year ago, according to the Bank of England.

This was 11th consecutive monthly increase, putting new mortgages at their highest level since March 2008 – but still well below pre-recession levels.

Leeds Building Society has launched a 2-year fixed rate mortgage at 3.79%. There is no higher lending charge and 10% capital repayments are allowed each year without penalty.

There is also a £199 booking fee and an £800 completion fee up to £500,000,and 1% of the loan amount above that figure.

Coventry Building Society today (26 November) launched a new mortgage product range, with rates lowered by up to 0.66%.

The Coventry offers Fixed, Tracker and Flexx products in its Residential, Offset & Buy to Let ranges, as well as offering a variety of different Loan to Value levels and arrangement fee options.

The Treasury proposed today to extend the scope of FSA mortgage regulation to cover second-charge mortgages, buy-to-let mortgages, and the sale of mortgage books to third parties, provoking the following mixed response from the Council of Mortgage Lenders (CML):

“The CML supports an extension of FSA regulatory scope to second-charge lending - indeed, the CML argued before FSA mortgage regulation was introduced in 2004 that it should cover all secured lending, not just first-charge mortgages.

The net increase in bank mortgage lending was £3.1bn in October, the same as in the previous month, but higher than the average of £2.7bn over the previous six months.

The average monthly rise in this period over the last decade has been 5%, so the October figure was typical.

Ipswich Building Society has launched a two-year fixed-rate mortgage at 5.64%, with a loan-to-value of 85% for both purchase and remortgage.

The application fee is £150 and the completion fee is £999, which can be added to the loan.

Some specialist mortgage lenders have been so reckless that between 30% and 60% of their borrowers are now in arrears, according to Jon Pain of the Financial Services Authority (FSA).

Speaking to the annual conference of the Council of Mortgage Lenders (CML) in London, Mr Pain was defending the FSA's plan to bring in new rules to restrict mortgage lending, which was put out to consultation last month.

While lenders originally reduced rates following the drop in bank base rate to 0.50%, they increased them again in the following months.

From today, 10 November, Abbey is promising to reward loyal customers with lower rates on mortgages.

Existing Abbey and Alliance & Leicester current account customers who have held their account for more than six months will be entitled to benefit from new deals available in branch or on the telephone for a limited period.

Nationwide has cut fixed and tracker rates on some mortgage deals from Friday 6 November 2009.

"We are making 19 individual rate cuts of up to 0.31% on some of our house purchase and remortgage products.  This, together with the special offers we recently announced for first time buyers and house purchasers, will be good news for those trying to get on the housing ladder or secure a new home," said Andy McQueen, mortgage director at Nationwide.

Mortgage lenders are gradually reducing the size of the deposit they require from prospective borrowers, according to financial information service Moneyfacts.

The number of mortgages requiring a 20% deposit has fallen from 136 to 117 in the past month, while the number requiring a minimum 15% deposit has increased from 189 to 226 – which is the largest number for more than a year.

Net mortgage lending increased by £0.9bn in September, weaker than the August figure of £1.3bn, but above the previous six-month average of £0.6bn, according to Bank of England figures, released today, 29 October.

The number of loan approvals for house purchase (56,215) was above the August figure (52,970) and above the previous six-month average, whereas approvals for remortgaging (25,528) were below the August figure of 28,348 and below the previous six-month average.

The news that Barclays is acquiring Standard Life Bank has attracted the following comment from Ray Boulger of mortgage broker John Charcol:

"Today's announcement isn't great news for consumers, as it means that one of the dwindling number of brands still active in the mortgage market may well disappear next year when the sale is concluded.

Leeds Building Society has launched a range of offset mortgages from 5.49%. Borrowers can access mortgage funding with a 15% deposit and there are other options for those requiring help with up-front costs.

The maximum loan to value on the 5.49% product has been increased from 60% to 80%, and  unlimited capital repayments are allowed. A 5-year fixed rate is available from only 5.50%. There are also versions of this product that only require a 15% deposit.

Woolwich, which is owned by Barclays, has cut the rates on its fixed-term mortgages by up to 0.5% as it launches a new range of two-,three- and five-year products.

Its two-year fixed-rate deal, with an 80% loan-to-value, has been reduced to 5.49% from 5.99%, plus a £999 fee.

Self-certification mortgages, in which borrowers do not have to provide evidence of their income, will be banned under proposals outlined today by the Financial Services Authority (FSA) to tighten up regulation of the home loans market.

The FSA says that lenders should be required to verify borrowers' incomes, rather than just taking their word for it. 

First direct's launches two new fee-free offset tracker mortgages today. The first, with a 60% loan-to-value (LTV), tracks 2.49% above base rate (currently 2.99%).  The second, a 75% LTV deal, tracks 2.94% above base rate (currently 3.44%). Both are available for re-mortgages only.

Customers will not have to pay a booking fee, an arrangement fee, an exit fees (or closure admin fee), an early redemption penalty or a Standard Valuation Fee.

There was a slight drop in new mortgage lending in August, according to theCouncil of Mortgage Lenders (CML).

The total number of loans for housed purchase fell by 5% to 53,000 during the month, as against 56,000 in July. But even that lower figure was 29% higher than in August last year.

Mortgages look set to get cheaper, as economic forecasters suggest that interest rates are set to remain at record lows for at least five years.

The Centre for Economic and Business Research predicts that the Bank of England will keep rates below 2% until 2014, keeping money cheap and sparking a price war between lenders.

That is bad news for savers, who have seen  their income slashed as the Bank of England has cut rates to just 0.5% over the past year.

Coventry Building Society is reducing rates and increasing LTV's on its range of residential and buy-to-let fixed-rate mortgages.

A new 2-year fixed-rate residential mortgage is now being offered at 3.87% available at 65% (up from 50%) LTV, with free valuation and free remortgage transfer service.

Some high-profile lenders have significantly cut their rates in the past few days. They include:

Abbey – Selected fixed rates reduced by up to 0.11%
Cheltenham & Gloucester - 5 year fixed rate (via intermediaries only) reduced by 0.20% to 5.99%
Nationwide - Selected variable tracker rates reduced by up to 0.36% and selected fixed rates for 1 and 2 years reduced by up to 0.70%
Northern Rock - Selected rates reduced by up to 0.30%
Woolwich - Lifetime tracker rate reduced by 0.45% to 2.79%

From today, Wednesday 7 October, Abbey is reducing some of its fixed-rate mortgage range by up to 0.11%, and new tracker rates are launched at 2.94%.

The new fixed rates are available through both Abbey and Alliance & Leicester branches and are as follows:

HSBC is extending its 1.99%, two-year discount mortgage offer until the end of October. 

The mortgage, which was launched on 1 September, led to the sale of a total of £245m of discount mortgages during September alone, the company says.

More than half (53%) of borrowers who say they are on a tracker mortgage are still not taking advantage of historic low interest rates to overpay on their loan, according to professional advice website Unbiased.co.uk.

Of the tracker mortgage borrowers surveyed, just one in five (20%) have kept repayments at the levels they were before the round of rate cuts earlier this year, enabling them to take full advantage of the opportunity to reduce the amount outstanding and the term of their mortgage.

Lending for house purchase showed a year-on-year growth in July for the first time since early 2007, according to the latest Council of Mortgage Lenders' (CML) survey.

Total gross lending rose significantly, to £14.5bn, the second consecutive monthly rise. But it was still 42% lower than in July last year.

A government campaign to provide information for homeowners struggling to meet their mortgage payments was launched today, 8 September.

The information campaign, which seeks to help borrowers stay in their homes by taking control of their payment problems, reinforces key messages from lenders to mortgage customers: don't ignore the problem; get help by talking to your lender; it's never too early to contact your lender to talk about your worries.

HSBC's new mortgage range features its lowest ever interest rate - 1.99% on a two-year discount loan - available to customers with a deposit of 40% of their property value.

The range of new loans includes a second two-year discount mortgage for customers with at least a 25% deposit at an interest rate of 2.49%. Both discount mortgages have arrangement fees of £1,199 and are discounted from HSBC standard variable rate (currently 3.94%).

Banks took in more than they lent out in July, for the first time on record. The net repayment figure was £418m, even though mortgage approvals increased for the sixth month in succession, according to the Bank of England.

The number of loans for house purchase was 50,123, up 5% on June, and for remortgaging 35,206, both above the average for the previous six months. This suggests that lenders are becoming less reluctant to part with their money.

A growing number of borrowers with good credit records are falling into arrears with their mortgage payments, according to a report by the Moody’s rating agency.

Arrears of more than 90 days on prime residential mortgages have doubled since last year, from 0.9% in the second quarter of 2008 to 1.8% in the same period this year.

The recent steep rise in the cost of fixed-rate mortgages has hit their popularity hard, according to the John Charcol Index, the monthly mortgage activity monitor produced by mortgage adviser John Charcol.

"The popularity of fixed rates with our clients has been on a roller coaster since the beginning of last year,” said Ray Boulger of John Charcol.

There were 38,181 mortgage approvals by the major banks in July, 7.4% up on June and 77% more than a year ago, according to the British Bankers' Association (BBA).

The number of loans approved for house purchase in July was the highest since February 2008.

Almost one in four (23%) of mortgage holders are currently only paying off the interest on their loan, according to research from moneysupermarket.

As mortgage interest rates have fallen dramatically over the last 12 months, the cost of switching to capital repayment with the same lender and on the same terms would only be around £25, moneysupermarket says. Current interest-only borrowers would see their repayments increase by around £50 per month over what they were paying 12 months ago. Over the 300-month life of the mortgage, this switch would save approximately £40,000.

Mortgage lending increased by 26% in July, to about £16bn, according to the Council of Mortgage Lenders (CML).

Despite the latest rise, lending was still more than a third lower than in July last year, when it stood at £24.9bn, and the CML expects the housing market to dip again later this year.

Almost a third of homeowners are now staying on their lender's standard variable rate (SVR), according to new research from Unbiased.co.uk, the professional advice website.  The number on SVR has  increased from 23% earlier in 2009 to 27%, highlighting that more homeowners are now sitting tight on their low-rate SVR, rather than remortgaging to a fixed rate.

When describing their current mortgage situation, one in four (25%) of homeowners state they are on their lender's SVR and have no plans to change this.  This rose to over one in three (36%) of those aged 55 and over.  With best buy standard variable rates generally remaining lower than best buy fixed rate mortgage deals in the current market place, it appears homeowners may not be considering a move to a fixed rate unless the base rate starts to rise.

Restrictions on access to mortgage finance is preventing as many as 3.5m British households from moving, according to mortgage broker John Charcol. That figure represents a third of all residential mortgages. Lack of equity in the property is another factor trapping them in their current home.

There are currently around 2m households either in negative equity or with equity of less than 10%, and 500,000 households with equity of between 10% and 15%. A further 1m households have either sub prime or self-certified mortgages.

The Financial Services Compensation Scheme (FSCS) says it expects a rush of claims against mortgage brokers in 2009/10, after banking failures saw it pay out more than £21bn in total in the last financial year.

In its latest annual report, the FSCS said 2008/9 was the first time the scheme had started paying claims against brokers since mortgage advice and arranging came under regulation in 2004.

Mortgage approvals increased to 47,584 in June, from 44,169 in the previous month, according to figures from the Bank of England. It was the highest number of approvals for house purchases since April 2008, and the fifth successive month that approvals have gone up.

Although these are further signs of a pick-up in the housing market, the figures are well below the levels seen during the property boom. Demand for housing is still being constrained by the continuing shortage of credit, and also by a widespread feeling that prices still have some way to fall before the market bottoms out.

The British Bankers Association (BBA) has hit back at claims that mortgage rates and profits have soared in recent months while base rate has remained at an all-time low.

Banks’ costs have risen "substantially", and they have been obliged to increase their reserves to twice the world average, according to BBA chief executive, Angela Knight.

The steep fall in available mortgage products has continued, despite previous claims of ‘green shoots' in the housing market, figures from moneysupermarket.com show.

The tracker mortgage market has been the worst hit, with the number of available products falling 81% since July last year, while the number of fixed-rate mortgages has fallen by 46%.

There were modest increases in gross and net mortgage lending in June, as a result of more new home loans being approved in recent months, according to figures from the British Bankers’ Association (BBA), released on 23 July.

“Numbers of new home loans approved by the high street banks are recovering from the very low level last November and so far this year, gross mortgage lending has topped £50bn. After
repayments and redemptions, the banks’ net rise in mortgage lending of £18bn in the first six
months is in sharp contrast to lending by the rest of the market, which is still contracting,” said BBA statistics director, David Dooks.

The withdrawal this week of Manchester Building Society’s 30-year fixed-rate mortgage means that borrowers can no longer fix their mortgage repayments for more than 15 years.

Two years ago, the Prime Minister prompted a number of lenders to offer longer-term fixes by saying that they would help to reduce the volatility in the housing market. But now the market has disappeared.

Mortgage lending rose sharply in June compared with the previous month, according to figures from the Council of Mortgage Lenders (CML). The total was up 17% to £12.3bn in June, from £10.5bn during the previous month.

However, the figure was 48% down on the £24.8bn advanced for home loans in June last year.

 
Gross lending in the second quarter of 2009 totalled an estimated £33.3bn, unchanged from the first quarter, which was the lowest quarterly reading since the first quarter of 2001. 

First-time buyers are taking advantage of the recent falls in house prices to step on to the housing ladder, despite the need for a huge deposit.

Research from the comparison website Moneysupermarket.com found 13% of 18-34 year olds are considering buying their own home in the next 12 months. A quarter of first-time house hunters have the deposit saved already; no mean feat when you consider the average deposit for a first time buyer is £32,000.

Nationwide Building Society has announced it will allow customers to take out loans worth 125% of the value of a home, if the customer is in negative equity and wants to move. The scheme works by allowing the borrower to take out a loan for 95% of the new property's value at a fixed rate of 6.73% for three years or 7.48% for five years. 

Nationwide Building Society has announced it will cut the price of fixed rate mortgages by up to 0.99% - but only for existing borrowers who are switching at the end of their Nationwide deal.  The offer, which takes effect from 9 July this year, includes the following range of mortgage options:

Financial services companies must make sure their customers understand what they are letting themselves in for when they sign up for mortgages, consumer loans and other products, under new OECD guidelines, entitled Good practices on financial education and awareness relating to credit, which are designed to avoid a repeat of the sub-prime mortgage crisis and ensuing credit crunch that sent the world economy into recession.

"Even in the absence of the crisis, developments in financial markets, demographics, economic and policy changes all point to the importance of financial education and enhanced financial consumer protection,” said André Laboul, Head of the Financial Affairs Division of the OECD.

Of those who did seek advice, two-thirds (65%) went to their mortgage lender, while one in four went to Citizens' Advice (CAB). Consumer experience of lenders' advice was mixed: some felt their mortgage lender was unhelpful and inflexible, whiler others felt their provider did all they could reasonably do to help them.

Mortgage repayments in the first three months of this year totalled a record £8.14bn, according to the Bank of England.

Repayments for the year to the end of March came to £76bn.

The mortgage is currently priced at 2.98% (3.2%APR) and offers new customers customers the security of being capped at 4.99% until 2012.

Gross mortgage lending by building societies has fallen like a stone, according to new figures published by the Building Societies Association (BSA).  In May, the mutual sector lent £1,515m, compared to £3,530m in May 2008.

Borrowers are more hesitant to take up fixe-rate deals, as lenders hike up their prices by an average 0.6%, while trackers rates, which have largely been avoided in recent months, are now being cut by around 0.3%. The conundrum has meant that, whereas 75% of borrowers had been taking fixed rates, the number has dropped this week to 64%, says broker Mortgageforce.  

Almost 90% of borrowers fixed their mortgage rate in the second quarter of 2009, according to Legal & General’s Mortgage Purchase Index report, which analyses trends from thousands of mortgage applications made through its Mortgage Club.

Leeds Building Society is offering a new five-year fixed rate mortgage available from 5.1%. There is no higher lending charge, it includes free in-house legal services for remortgages and 10% capital repayments are allowed each year, without penalty.

Gross mortgage lending totalled an estimated £10.3 billion in May, a 2% decline from the £10.5 billion in April and down 58% from May 2008, according to new data from the Council of Mortgage Lenders. 

 

Fixed-rate mortgages have been falling for nearly two years, but experts are now warning they are about to start creeping up again. After a statement issued by Ray Boulger at broker, John Charcol earlier this week, Moneysupermarket.com has also put out a warning to borrowers.

There was a 16% increase in mortgages granted for house purchases in April, compared with the previous month, according to the Council of Mortgage Lenders (CML).

But the number of loans – 35,600 - was still 28% lower than in April 2008. Over the past seven years, the average number of loans granted in April averaged 88,000.

Nationwide is set to increase the cost of its fixed-rate mortgage deals from Friday 12 June, broker John Charcol  revealed today. All its fixed-rate deals are undergoing a re-pricing, with the biggest increase being 0.86% on one of its five-year fixes. This will increase the cost of a £150,000 interest-only mortgage by £6,450 over a five-year period, said the broker. 

Providers are increasing average mortgage rates, and the margin above the Libor rate is rising, even though Base Rate remains at 0.5%, according to moneysupermarket – which accuses the Bank of England of being “increasingly toothless” when it comes to regulating the cost of mortgages, with lenders increasing profit margins at the expense of their customers.

Moneysupermarket figures indicate that the average rate for the lowest tracker mortgage has gone from 0.22% above Libor in October 2008 to 1.99% in May this year, while the average two-year fixed rate has gone from 0.33% above to 2.20%, and the average three-year fix has gone from 0.16% above Libor to 2.78% above.

Britannia building society is re-introducing a 90% loan-to-value option across its mortgage range from next week.

Borrowers can choose between two-, three-, five-, 10- and 15-year fixed-rate deals, with a choice of three LTV bands (up to 60%, up to 75% and up to 90%).

HSBC is reintroducing its Rate Matcher mortgage offer from Monday 8 June. It offers to match or beat existing mortgage rates as low as 2.49%, and fix them for up to five years. Under the offer all UK homeowners can apply, irrespective of their existing mortgage arrangement.

Remortgage activity among homeowners has slowed dramatically since base rates started falling to their current historic low. Borrowers have struggled to better their lenders' standard variable rates (SVR), and although keen to fix, they have balked at fixed rate options at close to double what they would pay on a variable basis. The Rate Matcher offer enables homeowners to switch and fix at less than their lender's SVR or a rate of their choice.

"Gross mortgage lending by building societies was still 60% lower than gross lending in April a year earlier. Although also at low levels, building society mortgage approvals (which give some indication of future lending activity) were 14% higher in April than in March, after adjusting for seasonal factors.

The balance has tipped in favour of longer-term fixed rates, according to a report published by broker Mortgageforce.  It found that 56% of fixed rates taken out in May were three-year deals or longer.

Other features include free standard legal and basic valuation fees for remortgages, the facility to make overpayments and underpayments and to take payment holidays for home purchases and remortgages. There is a 3% early repayment charge for the initial tracker period.

One of the two-year fixes, at 3.49% (3.7% APR), has no arrangement fee but a booking fee of £99. The other, at 2.99% (3.8% APR), has a £999 arrangement fee and booking fee of £499.

Despite recent signs of improvement in levels of mortgage lending among banks and building societies, figures for April are down again, according to data published by the Council of Mortgage Lenders. 

Lloyds TSB has announced a new mortgage for first-time buyers called Lend a Hand. The deal offers a three-year fixed rate at 4.39% for just a 5% deposit. But in return parents’ savings – which must be equivalent to an additional 20% of the property value – must be held in an account with the bank.

The average two-year fix went from 4.61% a month ago to 4.64%, while the average five-year fix rose from 5.54% to 5.55%. The rate for a 10-year fix went from 5.74% to 5.78%.

HSBC has announced it is introducing a market-leading five-year fixed rate mortgage priced at 4.39% from 14 May. The deal comes with a fee of £999, on loans of up to 75% of the property value. The next lowest comparable mortgage is 4.59% with the Mansfield Building Society, says the bank.

Speaking at the FSA's mortgage conference, Lord Turner said that the FSA's detailed analysis of the mortgage market was highlighting a very complex situation, in which the FSA had to take account of short-term trends as well as designing the appropriate long-term policy.

Woolwich - the mortgage lending arm of Barclays - has announed cuts in the price of its fixed-rate mortgage deals. Existing and new  customers can now sign up for two years at a rate of 3.69% for loans of up to 70% loan-to-value (a reduction of 0.40 percentage points on the previous deal) and at 4.99% for loans up to 80% LTV (a reduction of 0.70 percentage points).

Mortgage approvals increased by 4% in March, to 39,230, and the trend is set to continue, according to the Bank of England.

The total value of the loans was £4.6bn, well above the six-month average.

The average homeowner on tracker mortgage has netted a saving of £230 on their monthly repayment in the face of falling interest rates, the Chancellor, Alistair Darling said in his 2009 Budget on Wednesday.

Gross mortgage lending was up 16% in March, at £11.5bn, according to the Council of Mortgage Lenders (CML) – which warned, however, that lending and house sales would remain low for the "foreseeable future."
 
The CML pointed out that the March figure was still less than half the amount lent in March 2008, and lending in the first quarter of this year was the lowest since early 2001.

Mortgage borrowers will be able to defer up to 70% of their interest payments for a maximum of two years if their income falls, under a government scheme, first announced last December, known as the Homeowners Mortgage Support Scheme (HMSS).

The plan, which is already under way, is one of several initiatives floated by the Government to avoid repossessions.

From 17 April, Alliance & Leicester, which is part of the Santander group, is extending its range of fee-free mortgages, with the launch of 3-and 4-year fixed-rate remortgage and homebuyer deals, which are available up to 75% loan-to-value.

The 3-year fix is at 4.69% and up to £550,000 for both homebuyers and remortgages.
 

The number of loans for house purchase notched up in February to 24,300 - an increase of 4% on the previous month, according to figures from the Council of Mortgage Lenders. However, although moving in the right direction, house purchase loans were still 47% down on February last year.

HSBC has joined forces with mortgage broker John Charcol in its launch of a seven-month trial intermediary service, which will operate from an initial 20 of its branches across the UK.

Building societies took deposits totalling £1,595m in February, the highest February net receipts on record, and an increase of 18% over February 2008’s £1,353m.

Commenting on the figure, Brian Morris, Head of Savings Policy at the Building Societies Association, said:

Dunfermline Building Society is reported to be in merger talks with an undisclosed number of English societies as it prepares to announce a £26m loss.

A merger with an English society will cause uproar in Scotland, which has seen its financial services industry all but destroyed with the near collapse of HBOS and Royal Bank of Scotland. Nationalist interests are calling for a Government rescue if Dunfermline is not to become subsumed into an English organisation, leaving the tiny Scottish as Scotland’s only remaining society.

There has been a 31% increase in mortgage arrears over the past year, according to figures from the Financial Services Authority (FSA).

At the same time, the number of repossessions rose by 68% in the year to December 2008, to 46,750 from 27,000 in 2007.

A poster in a bank window advertising a rate of 3.5% may look spectacular, but you might be better off choosing a mortgage of up to 4.5% - it all depends on the fees involved and the size of the mortgage. Fees are increasingly muddying the already confusing world of mortgages for consumers.

"When comparing, there are three key things you need to find out - the rate, the fee and the amount that will be left owing on the mortgage,” said Louise Cuming, head of mortgages at moneysupermarket.com.

The recession is seeing our confidence waning when it comes to giving financial 'tips' to friends and family, according a new study by the online directory of Independent Financial Advisers, Unbiased.co.uk. It reveals that, while 62% of Britain's homeowners would normally feel comfortable offering mortgage tips, today's confusing lending market has clipped the wings of more than a third (37%) of this group.

Nationwide Building Society has announced it will decrease its Base Mortgage Rate (BMR) from 3% to 2.5% from 1 April 2009 in line with today's base rate cut by the Bank of England.  The standard variable rates of the Derbyshire and Cheshire building societies, that have recently merged with the Nationwide, will also fall to 2.5% from the same date.

A virtual countrywide freeze on pay rises, coupled with a loss of overtime or shortened working weeks, is putting mounting pressure on the finances of British families. A survey published today by credit reference agency Equifax, conducted among its online credit report customers, shows that 84% of respondents have not yet received a pay rise in 2009. And over a third (36%) expect to earn less this year because of a loss of overtime or a shortened working week.

A drive to return to solvency is well under way, in the face of adverse financial times, according to research published by The Co-operative Bank Mortgages. It shows that the number of people making overpayments on their mortgages has increased by 50% in the past year alone.

Mortgage approvals by banks increased slightly in January, according to British Bankers' Association (BBA) figures. They reached 23,376 last month, 4% up on December’s 22,416.

The January figure was, however, still 43% lower than the same month in 2008, and the total net value of mortgage lending last month was lower than in December: £2.9bn compared with £3.3bn.
 

As the Government makes yet another sweeping gesture to pick mortgage lending up off the floor, with its announcement that the nationalised Northern Rock bank is to start mortgage lending again, there is still one thing that will remain the same: applying for a mortgage this year is going to be extremely tough.   So, before you take the plunge, tick off this five-point checklist.

Northern Rock, the nationalised mortgage bank, is to start mortgage lending again in a remarkable about-turn by the Government, which a year ago put the beleaguered former mutual into run-off.

The Liberal Democrats have called to mortgage lenders to offer a 'five-year fixed, no fees, no frills' standard mortgage option, with lenders competing to offer the cheapest rate. Termed the SafeStart Mortgage, the vanilla deal would initially be offered to borrowers with a 15% deposit.

The 4.75% rate is available up to 60% loan to value. There is also a version available up to 75% loan to value at 5.25%. Both versions allow 10% capital repayments each year, have no higher lending charge and a fee of £749 (£199 booking fee and £550 completion fee).

One in 10 of us are not confident we can keep up with essential payments, such as mortgage and insurance, as the recession unfolds. This is according to the latest Financial Outlook Index from Virgin Money, which also found that almost one in three people (29%) in Great Britain expects a drop in disposable income this year, either through salary cuts or increased costs.

The mortgage landscape was entirely 'reshaped' in 2008, according to new data from the Council of Mortgage Lenders (CML), with the number of mortgages agreed plummeting. It found there were 516,000 house purchase loans last year, a decline of 49% from 2007 and the lowest level of activity since 1974.

The number of mortgage products available on the market has plummeted to a new low. There are now just 2,672 different mortgage loans on offer compared with more than 30,000 in August 2007.

The Bank of England confirmed expectations today by slashing base rate from 1.5% down to 1% - the lowest in its history. Borrowers with the most to gain are those on tracker mortgages that have no floor or 'collar'. With the base rate at 1%, a homeowner with a £150,000 typical tracker mortgage will be paying about £40 a month less, bringing the total reduction since last October to £350 a month.

Lloyds TSB and Cheltenham & Gloucester, the group’s mortgage lending arm, have pledged to pass on any interest rate cut to existing variable and tracker customers if the Bank of England cuts the base rate on Thursday.

The standard variable mortgage rate (SVR) - currently at 3.5% - will be reduced by the same amount on 1 March.

The Building Societies Association (BSA) has come out against a further interest cut when the Bank of England's monetary policy committee meets on Thursday.

The BSA said this any further reduction would have a "severe impact on savers" and might reduce the flow of funds into societies which they then lend on as mortgages.

The Co-operative Bank today launched a new range of tracker mortgages, including three- and five-year deals.

The three-year tracker, which is exclusively for current account holders of the Co-operative Bank/smile, is at 2.49% above Base Rate - that is, 3.99% - with 60% loan-to-value and no application fee. Maximum loan size is £500,000. Early repayment charges apply for the first three years, but there is a facility to make overpayments and underpayments and to take payment holidays for home purchases and remortgages.

Woolwich has announced that it is launching its lowest ever fixed-rate mortgage, priced at 2.29%. However, the rate only applies for one year, after which it switches to a tracker priced at 2.29% above base rate for life.

At current rates this part of the deal would be priced at 3.79%. It also comes with a three-year tie-in, during which it will cost 2% of the amount borrowed to leave. The arrangement fee is £995 and the mortgage is offered at 60% loan to value.

The equity release sector is holding up better than the mainstream mortgage market, with year-on-year decline of just 9% in the value of lending and of 4% in plans sold, according to figures for 2008 released today by the UK equity release industry body, SHIP (Safe Home Income Plans).
 
Figures published last week by the Council of Mortgage Lenders (CML) showed that overall mortgage lending decreased by 30% last year. 

Abbey is introducing from 23 January a new range of 3-year trackers, to add to the 2-year trackers currently available. Rates start at 3.99% with a £1,495 fee at 75% loan to value (LTV).

In addition, Abbey is extending the maximum loan size on all 75% LTV trackers to £350,000 from £250,000.

Britannia Building Society and Co-operative Financial Services (CFS) have this morning agreed a merger to create new super-mutual which will be trumpeted as an 'ethical alternative' to shareholder and government-owned banks. The new business will combine CFS's experience in corporate banking, insurance and investment with Britannia's well-known high street presence and savings and mortgage books.  

Many homeowners who were braced to pay more expensive mortgages this year have found themselves in an advantageous position as lenders trip over themselves to outdo the next with thjeor super-low fixed and variable rate offerings. The first shot was fired by HSBC last Wednesday when the bank announced the launch of a two-year discount mortgage priced at 0.95% below its Standard Variable Rate (SVR).

Nationwide Building Society has announced that it is cutting the price of its fixed rate mortgage deals by up to 1%.  With effect from 21 January, the lender will reduce the rates on its two, three and five-year fixed mortgages. The new range includes a two-year fixed rate priced at 4.59% with a £599 fee for homeowners with a 60% Loan to Value - and the same deal with a 'no fee' equivalent priced at 5.09%.

Alliance & Leicester has reduced rates across its mortgage range, with a two-year fixed rate now starting from 3.19% and trackers from 3.29%.

Two new five-year fixed rate deals have also been introduced, offering customers the choice of a set fee at £999 or a 1% fee. The rates are 4.64% and 4.89% respectively, with the set fee deal available up to a maximum LTV of 60% and the 1% fee deal being offered up to 75% LTV.

Just 33,000 new mortgages were granted in November, 17% fewer than in October 2008 and 59% down from November 2007, according to the Council of Mortgage Lenders (CML).

The 18% average deposit required of first-time buyers was the largest for at least 35 years. Many first-time buyers would continue to struggle to raise the money for such large deposits, the CML said.

The product comes with a free standard mortgage valuation and free legal fees for remortgages or £200 cashback for purchases. The maximum loan size is £500,000.

HSBC has launched a new range of mortgages today, priced at the lowest interest rates in the bank's history. Premier customers of HSBC can pay as little as 2.99% on its two-year discount mortgage if they have a 40% deposit, in return for a fee of £999. The deal, which is priced at 0.95% below the bank's Standard Variable Rate, is available from 6 February, when SVR will hit 3.94%.

Only ten lenders are still offering 90% loan-to-value mortgages – which means that first-time buyers are effectively shut out of the mortgage market, according to research by the independent mortgage comparison site mform.co.uk.

RBS, which includes NatWest, is the only one of the bailed-out banks that has a 90% mortgage on offer, despite pressure on these banks from the Government to continue lending.

The Co-operative Bank has today launched what it claims is a market-leading five-year fixed rate mortgage, which will be available from 14 January.  For a £1,495 application fee, the deal will be priced at 4.49% for Loan to Values of up to 60%. For remortgagers, it also comes with free standard legal and basic valuation fees. Early repayment charges apply for the full five-year term, though overpayments can be made during this time.

Its aim is to achieve costs savings of £30 million a year, and it will take a one-off restructuring charge of around £40 million.

New offset products include a two-year 4.49% fixed rate or a fee-free option of 4.79% fixed, both available at 65% loan to value.

Nationwide, the country's largest building society, has said it will not pass on any more interest rates cuts to mortgage borrowers with tracker loans, to protect the interests of savers, who outnumber borrowers by seven to one.

The move will be a controversial one, as tracker loans are supposed to charge interest rates that follow the Bank of England Base Rate, and a further cut in the rate charged by mortgage lenders would be expected if, as widely predicted, the Bank cuts its Base Rate  by another half percentage point when the Monetary Policy Committee holds its first meeting of 2009 next week.

The cheapest standard variable rate mortgages in 2008 were offered by First Direct, Direct Line and HSBC.

In the mutual sector the Nationwide and the Skipton building societies were the cheapest, and occupy fourth and fifth places respectively, according to Defaqto's annual survey of the largest lenders.

Homeowners have largely stopped taking out new loans secured against their properties to fund spending, according to the latest figures from the Bank of England.

"Mortgage equity withdrawal" has fallen for the second successive quarter as borrowers rein in spending and attempt to pay down their home loans. Borrowers injected a net total of £5.7bn into housing equity - in other words, repaid their miortgages - in the third quarter, the highest quarterly figure since records began in 1970.

Mortgage lending by the big banks hit a new low in November, when they fell by 14% to 17,773, according to the British Bankers’ Association. Approvals for house purchases were 60.7% lower than in November 2007.

With banks demanding a bigger deposit from buyers, the average amount borrowed by purchasers in November was £117,000, down almost 24% on a year ago.

The outlook for the mortgage market is still grim, according to figures out today from the Council of Mortgage Lenders. They reveal that gross mortgage lending has now fallen a staggering 51% from November last year and 22% on October.

While there is typically a decline from October to November, this is considerably larger than usual, says the CML. This reflects the market disruption and continued deterioration of confidence in the economy.

The CML is today also publishing mortgage market forecasts for 2009, but cautions that, in the current challenging environment, the forecasts need to be seen as indicative rather than as a precise assessment of likely activity.

Cuts in interest rates are failing to bring mortgage costs down significantly for new loan deals, with the rate on new tracker deals falling by less than a percentage point.

After a third attempt by the Bank of England to kick-start the economy by slashing base rates, enthusiasm for cheaper lending among banks and building societies has been notable by its absence.

Mortgage lending rose a little in October compared with a month earlier, according to figures from the Council of Mortgage lenders, but slumped by more than half compared with a year earlier.

There were 39,900 house purchase loans in October, worth £5.5bn, an increase of 14% in volume and 10% in value from September, but an annual decline of 52% in volume and 57% in value.

Halifax’s decision to waive the collar on its mortgages could cost the beleaguered lender up to £575 million a year.
 
The bank had a floor on its tracker products of 3%, which meant that the rates paid by borrowers could not fall below this figure plus their tracking margin. However, Halifax has, like other banks, decided to yield to pressure from the Government and disregard the clause in its contracts that enforces the floor.

The bank, which is being supported by taxpayers' money and is due to merge  with Lloyds TSB early next year, is falling into line with other major lenders whose borrowing rates follow the Bank of England with no limit.

The offset product tracks the Bank of England base rate for the life of the loan. It is priced at 1.49% above the base rate and is currently 3.49% (APR 3.6%). The mortgage has a £599 arrangement fee and maximum loan to value of 80%.

Many people facing repossession of their home will be able to defer mortgage payments for up to two years, under 'mortgage holiday' proposals announced by Prime Minister Gordon Brown during a House of Commons debate on the Queen's Speech today.

The plan is designed to give a breathing space to those who lose their jobs or take a big reduction in their income. It will cover mortgages of up to £400,000, according to the BBC.

Only 32,000 mortgages were approved in October, 1,000 fewer than in the previous month, according to figures from the Bank of England.

The value of mortgage loans in October was almost 70% lower than in September, at £459 million - the second lowest figure on record, and just 6% of the level a year ago.