New mortgage cuts announced

Abbey has announced more mortgage rate cuts as the downward progress of rates across the industry continues.

The bank has added more cuts to those announced by HSBC, the Co-operative Bank and Nationwide.

However, this latest move by Abbey is also lowering rates for those with smaller deposits.

It is to offer a 0.6 per cent cut from Monday on two-year fixed-rate mortgages on a deposit of 15 per cent, lowering the rate from 7.04 per cent to 6.44 per cent.

Until now, none of the recent cuts have been on loan-to-value deals of 85 per cent or higher.

Abbey's director of mortgages Phil Cliff said: "The rate and fee cuts, plus the new deals, mean we have an extremely competitive range for customers with deposits of 15 per cent or more."

In a Headline Money poll on the issue of mortgage lending, a Lloyds TSB spokesperson said the mortgage market may gradually correct all its recent problems "naturally", adding that it should be remembered that the market is "cyclical".