Mortgage price war continues!

The mortgage price war continues as HSBC and First Direct slash their home loan rates to offer some of the cheapest deals ever seen.

• HSBC offers a two-year fixed at 1.29 per cent for buyers with a 40 per cent deposit.

• First Direct has a five-year fix at 2.39 per cent with a £1,450 fee for those with a 35 per cent deposit.

Buyers with a 40 per cent deposit can now get a two-year fixed-rate deal at just 1.29 per cent with HSBC. Monthly repayments on a typical £150,000 loan are £585 pm and the total cost, including a £1,499 fee, is £15,539.

First Direct has a five-year fixed-rate loan at 2.39 per cent with a £1,450 fee for those able to put down a 35 per cent deposit. Monthly repayments are £665 pm, and the total five-year cost is £41,350.

For those who want to pay a smaller fee, Norwich & Peterborough BS has a two-year fixed-rate loan at 1.74 per cent with a £195 fee. You need a 35 per cent deposit, and monthly repayments on a loan of £150,000 are £617 pm.

Among the best offers for those able to rustle up a 25 per cent deposit, is a 2.79 per cent deal from Leeds BS with an £800 fee, fixed over five years. Monthly repayments are £695 pm and the total cost is £42,500.

Meanwhile, the Post Office has a two-year fix at 1.99 per cent with no fees. Monthly repayments are £635 pm and the total cost £15,240.

Barclays yesterday announced the UK’s lowest ever ten-year fixed-rate mortgage at 2.99 per cent, including a £999 fee, for people with at least a 40 per cent deposit. This was previously available at 3.45 per cent, and the bank also cut its rates for two and five-year fixed rates.

There is no doubt that lenders have got off to a great start this new year, and there is an exciting range of deals with all different combinations of low rates, small fees, no fees and freebies.