Mortgage rates drop but could fall further, says

Date:Friday 13th November 2009
Author: Susanna Kavka

While several institutions have cut the rate of their mortgages, they could reduce them further to help prospective buyers, according to

The average rate for a 60 per cent loan-to-value mortgage a year ago was 5.42 per cent. When the Bank of England base rate was cut six months ago the average fell to a low, of 4.13 per cent.

Today, however, this figure has increased to 4.66 per cent, meaning a borrower with a 40 per cent deposit on a £150,000 loan would be paying back £45 extra per month than if they had taken the loan in May.

Although lenders have been slow to reduce rates, the number of loans available has passed 1,800 for the first time since January 2009, with 109 of them offered with a ten per cent deposit.

Self-certification mortgages have declined rapidly in this period, with the number falling from 860 in July 2007 to just two present on the market when released their findings last month.

Michelle Slade, spokesperson for, said: "The positive news for borrowers is that while rates are slowly decreasing, we are seeing signs that credit conditions are slowly easing".