Relief as mortgage lenders enter 'price war'

Hope is circulating in the ailing property market after Britain''s two biggest mortgage lenders entered into a tracker-mortgage price war, according to an online financial adviser.

The price war was targeted at buyers with large amounts of equity and saw both banks drop the rates on two-year tracker deals far below six per cent.

Abbey announced that it would offer a rate of 5.69 per cent to anyone with a 25 per cent deposit willing to pay a £1,950 arrangement fee.

Halifax quickly followed suit with a 5.59 per cent tracker mortgage offer.

David Doulton, director at Fairinvestment.co.uk, said: "This is great news from our two biggest lenders for those homeowners who have enough equity or a big enough deposit to be eligible for these deals."

According to research by Mform.co.uk, the most competitive mortgage deals are 0.64 per cent higher than they were this time last year, with the average rate coming in at 6.34 per cent.

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