RBS reduces its mortgage rates.
The government and BoE are encouraging UK lenders to cut their mortgage rates and introduce more competitive offers.
The funding for lending scheme announced in July was formally launched on 01 August. Since news of its launch, lenders have been cutting mortgage rates and RBS has cut its rates by almost 2%.
In a move to encourage new customers RBS has cut its 5 year fixed rates by up to 1.70%, the lender advises this is a significant rate reduction. A fee free 5 year fixed rate is now on offer for 90% loan to value at 4.79%.
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RBS has also confirmed the launch of a 2 year fix for 60% loan to value at 3.49%. A 2 year buy to let tracker deal is also available on the same terms.
With many lenders having recently announced rate cuts it is hoped that the availability of cheaper mortgages will allow more first time buyers to climb on the housing ladder.
A RBS spokesperson commented on this point advising that lower mortgage rates may help first time buyers however first time buyers problems are not just rate related.
High deposit levels, high fees and the end of the stamp duty concession means that is remains expensive to buy a home.
The hope is the funding for lending scheme will lead to lenders relaxing their lending criteria and offering more affordable deals aimed specifically at the first time market.
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