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The Bank of England recently decided to hold the base rate at the all time low of 0.5% for the 11th month in a row – as a result more borrowers are opting for tracker rates.

According to Legal & General, there has been a big shift towards tracker rate mortgages – in fact 43% of residential mortgages were tracker rates at the end of 2009, up from 17% in the third quarter of 2009. This wasn't just the case in residential loans – L&G found that 57% of buy-to-let borrowers chose a tracker compared to 30% in the quarter before.

But while trackers remain cheap, fixed rates are improving too – L&G found that the average three year fixed rate was down from 5.86% to 5.46% and the average five year fixed rate down from 6.42% to 5.80%.

Stephen Smith, director of housing at L&G says: “Most commentators are still expecting the base rate to stay low for some time to come, so this is a golden opportunity for people to think about paying off some of their debt. The low interest rate environment has lead to a fair bit of innovation in tracker products, what with capped trackers, reverse stepped trackers and lifetime trackers all featuring recently.”

If fixed rates are looking cheaper and trackers are remaining low which one do you choose? Good question, but one that can only be answered by a mortgage professional. They will assess your short and long-term plans alongside your assets, your debts and your earnings and from that they can help you assess whether it is more prudent to lock in to a fixed rate or opt for a tracker.

SOURCE: L&G, 04/02/10

To keep up with the latest news and comments on the mortgage market please visit the Mortgage Broker Blog.

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The British perception of the mortgage market is softening in 2010 and many more people may be considering mortgage finance this year.

Research from Unbiased.co.uk has found that consumers no longer expect house prices to fall and only 3% are holding off buying a property until prices have fallen.

Also, despite over half of people saying that house prices wouldn't recover until late 2010 onwards back in January 2009, nearly a third of Brits now say that house prices are starting to rise and 18% say that they have reached their lowest level.

Karen Barrett, chief executive of Unbiased.co.uk says: "The last year has seen a real shift in the attitudes of consumers towards buying a house. No longer are potential homebuyers biding their time until house prices have fallen. They are now looking to buy and gathering the means to do so.

"Despite strict lending criteria and the prospect of increasing house prices, people are also still prepared to negotiate the value of their home down from the asking price although their expectations may be slightly lower.

"With interest rates holding at an all time low consumers are seeing the importance of getting the right mortgage now more than ever. Those buying a new property, but also those looking to remortgage, will benefit from seeking professional advice on the whole of the mortgage market to get the best mortgage deal for their circumstances."

SOURCE: Unbiased.co.uk, 01/02/10

To keep up with the latest news and comments on the mortgage market please visit the Mortgage Broker Blog.

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New data has found that after nearly two years, mortgage products are once again truly cheaper through a mortgage broker than directly through the lender.

After the banking crisis took hold, lenders opted to concentrate on branch business in a move directly to control the volumes of new mortgage approvals. This meant that people going to a mortgage broker soon found that they could get a mortgage cheaper if they simply walked into their local bank or building society.

This so called 'dual mortgage pricing' become a headache for both brokers and borrowers, especially those who favoured the added value service offered by a financial adviser, such as those with extra ordinary or multiple income streams.

But for the first time in the last two years, brokers are finally getting back to a level playing field. Moneyfacts.co.uk has found that average rates on two year and five year trackers as well two year trackers are cheaper through a broker than through branches directly.

Darren Cook, analyst for Moneyfacts says: "Like many others, mortgage brokers have probably felt one of the biggest impacts of the banking crisis and they have also had to deal with an added frustration of dual pricing.

"The proportion of the market that brokers have access to may have fallen, but it looks like they are starting to compete evenly on price. Brokers always have and always will form an integral part of a healthy mortgage market, so we hope that dual pricing fades away soon and we return to a level playing field as quickly as possible."

Brokers like The Mortgage Broker have been frustrated these two years because they could not always offer their clients the best mortgage rates even though they could offer so much more such as financial advice, insurance and loan advice. But now things are changing and people can once again be sure that the very best place to go for a mortgage is through a broker.

SOURCE: Moneyfacts, 29/01/10

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Homeowners in England and Wales saw a 20% drop in the proportion of their take-home pay spent on monthly mortgage repayments in 2009.

According to the latest research by Woolwich, in December 2008 homeowners across England and Wales were spending on average £196 of every £1000 of their take home pay each month on their mortgages. A year later this had dropped to £157. The average monthly mortgage payments for homeowners now stands at £497, compared to £607 in December 2008.

Andy Gray, head of mortgages at Barclays says: "For the 11 million UK households who have a mortgage there is a silver lining to the recession – a substantial reduction in mortgage payments right when they need it most. For them it's a chance to save in a way they might not have been able to before, or to overpay their mortgage and cut years from its life."

Though this is good news, it shouldn't be automatically assumed that everyone is experiencing a cheaper mortgage. Some people simply have the wrong mortgage and are oblivious to the savings they could be making if they just picked up the phone and asked a mortgage adviser whether there is a better loan out there for them.

If you are paying a lot more than £497 a month for a mortgage it might be time to do some shopping. Have a look online and see what sort of prices are on offer from mortgage lenders. Then call an independent mortgage expert and ask them to help you search the whole of the mortgage market for a loan that will save you money.

SOURCE: Barclays, 28/01/10

To keep up with the latest news and comments on the mortgage market please visit the Mortgage Broker Blog.

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This year has begun very well for mortgages as lenders not only increase the number of high loan to value mortgages available but also cut rates on a number of products.

According to Moneysupermarket, the amount of 85% LTV products increase by 22% since the end of 2009 and even more amazingly, 90% LTV products increase by 11% over the same period. Most borrowers were hampered in 2008 and 2009 by a huge lack of high LTV loans but the tide seems to be slowly turning.

The good news doesn't stop there. Rates across all mortgage products have begun to creep down since October last year. Rates for 80% LTVs have fallen hardest, with the average rate now sitting at 4.97%, 0.77% lower than in October last year.

Hannah-Mercedes Skenfield, mortgages channel manager at moneysupermarket.com, says: "Lenders seem to have started 2010 with their doors open and are clearly more open to mortgage lending than they have been for some time. The increase in products available at 85 and 90% is particularly encouraging for first-time buyers, as scraping together a large deposit is not easy, and was the reason many prospective first-time buyers deserted the market in their droves last year."

The website also found that, although there are only nine products available at 95% LTV, the average rate on those loans has fallen by 0.71% since October. This might be the most pertinent example of lenders becoming more confident in lending mortgages to those with little LTV but with the ability to handle a mortgage.

Those looking for a mortgage are finding more choices for them in the UK mortgage market, there is no doubt. But to be sure of accessing as much of the mortgage market as possible, a borrower must go to a whole of market mortgage adviser. They can search the whole of the market and find the perfect loan tailored for the borrower's situation, regardless of the lender.

SOURCE: Moneysupermarket.com, 26/01/10

To keep up with the latest news and comments on the mortgage market please visit the Mortgage Broker Blog.