Abbey cuts mortgage rates

Abbey continues to strengthen its competitive position in the mortgage market and from today (Friday 16 May) announces reductions in flexible and tracker mortgages and to some of its fixed rate deals.

A spokesperson for Abbey Mortgages said: "Our focus is to provide all of our customers with value and choice, whilst continuing to review our mortgage range and rates against a competitive and dynamic market. As such, we have taken the opportunity to reduce rates to a small number of fixed and tracker products within our range."

"Over the last two years, we have been carefully maintaining a balance between the profitability of new business, prudent lending criteria and our market share aspirations. Whilst current market conditions remain challenging, this sensible approach to risk has proved very resilient and allows us to reward lower fixed-rate LTV business with competitive rates."

"The current mortgage market poses an opportunity for financially strong lenders such as Abbey. Last month we announced a UK net lending share of 16 per cent, and since then we've seen an exceptionally strong pipeline of new business, as well as continuing to benefit from the improvements we've made in retaining our existing mortgage customers."

Fixed-rate products in the 75 per cent Loan-to-Value (LTV) range are reducing by up to 0.17 per cent and the five-year fix is now at a market leading 5.75 per cent. The rate reductions are being made to the two-year, three-year and five-year fixed rate products at 75% LTV and those with free valuation and help with legal costs (both for homebuyers and remortgage customers).

Abbey had already decreased rates on its flexible rate and tracker mortgages by 0.10 per cent in response to the Bank of England's recent cash injection. This additional 0.05

per cent reduction anticipates future falls in LIBOR rates and will further support the Bank of England's action in helping to bring liquidity back to the UK mortgage market."

New rates are as follows (all 75 per cent LTV):

Abbey's most competitive two-year deals:
2-year fixed rate mortgage - 5.95 per cent with £995 fee
2-year tracker rate mortgage - 5.97 per cent with £999 fee

Abbey's most competitive three and five year deals:
3-year fixed rate mortgage - 5.87 per cent with £999 fee
5-year fixed rate mortgage - 5.75 per cent with £1,499 fee