Britain's Three Largest Lenders Reduce Mortgage Rates

July 4, 2008 5:52 p.m. EST

London, England (AHN) - The three largest mortgage lenders in Britain will reduce their mortgage rates by up to 0.27 percent. The announcement by Halifax, Abbey and Nationwide followed a Bank of England warning that banks and building societies were likely to continue charging high interests to their borrowers over the next quarter.

Over the weekend Halifax will reduce by an average of 0.12 percent some of its tracker rate mortgages offered to current clients searching for a new rate.

By Wednesday, Nationwide will cut its tracker rate deal and fixed rate mortgages. The two-year fixed rate mortgages of Nationwide's customers will go down to 7.28 percent from 7.35 percent if they have a 10 percent deposit and pay $1,187 (599 pounds).

Abbey will reduce some of its tracker rate mortgages and fixed rate deals by 0.2 percent. The new rate applies only to Abbey clients who made a 25 percent deposit.

The cuts, even though minimal, were welcomed by British consumers. Broker Ray Boulger said, according to the Telegraph, "For the property market and mortgage brokers there is a silver lining to all the grim news on the economy."