Banks and building societies have made widespread changes to their UK mortgage rates in recent weeks, with a growing number of lenders raising rates on tracker loans as the escalating Eurozone debt crisis drives up the cost of funding these mortgages.

This week, Nationwide Building Society and Halifax – part of Lloyds Banking Group – became the latest high-street lenders to increase their tracker rates.

Halifax has upped the rates for tracker mortgages by as much as 0.30 percentage points, raising its two-year tracker from 3.04% to 3.34%.

It is available for loans up to 75% of a property’s value, with no fee.

Woolwich, Santander, Northern Rock, Accord & Barclays Wealth are among the other lenders to have raised their rates over the past month.

Not all mortgage rates are heading upwards.

At the same time as increasing several tracker rates, Nationwide Building Society cut the cost of some fixed-rate products – including its five-year fix, which was reduced from 3.69% to 3.59%.

Other mortgage lenders have eased their criteria and launched attractive products. On Wednesday, Barclays re-entered the 90% loan-to-value market, after it stopped offering these loans three years ago.

Coventry Building Society also launched a new range of fixed and capped rate products that come with no early redemption charges this week.

These are the current ‘best-buy’ mortgages deals available now.

Remortgages

While tracker rates have been going up, mortgage brokers say there are still a number of competitive deals available. Santander has a two-year tracker at 1.95% – Bank of England (BoE) base rate plus 1.45% – available up to 60% loan-to-value with a £1,995 fee. It comes with a free valuation and free legal work.

For those who want a longer-term tracker,

HSBC’s lifetime tracker at 2.49% – BoE base rate plus 1.99% – is a fabulous deal. It comes with no fees and no early repayment charges, which means borrowers can remortgage to a fixed-rate deal at any point during the mortgage term.

Fixed-rate deals remain cheap and have not seen any major rate movements. Leeds Building Society is still offering its 2year fix at 1.99%, available up to 75% loan-to-value (LTV), with a £1,999 fee.

Chelsea Building Society’s five-year fix at 3.29%, available up to 70% loan-to-value (LTV) with a £1,495 fee, is the market leading longer term fix.

First-time buyers: 90% deals

Barclays’ move to increase its maximum loan-to-value from 85 per cent to 90 per cent has provided first-time buyers with more options. According to Moneyfacts, the financial data provider, there are now 253 mortgages requiring only a 10% deposit, compared with 206 in October 2010 and just 101 in October 2009.

It is offering a three-year fix at 4.99% with no fee or a five-year deal at 5.49%, with a £499 fee. Its maximum loan size is £500,000.

Cambridge Building Society and Melton Mowbray Building Society are also offering five-year deals at 5.39%.

Large loans

Competition has increased in the large-loan market recently, with more high-street lenders offering these type of mortgages.

RBS Private Banking has a two-year tracker at 2.19% – BoE base rate plus 1.69% – available up to 50%loan-to-value, with a £999 fee.

NatWest has a two-year fixed-rate at 2.65%, available up to 60% loan-to-value, with a £999 fee.

Most wealthy borrowers will typically be better off opting for Barclays Wealth’s two-year tracker at 2.49%.”

Self-employed

Skipton Building Society has some of the most competitive deals for self-employed borrowers as it will consider retained profits in a limited company. It offers a two-year tracker at 1.98% – BoE base rate plus 1.48 percentage points – available up to 60% loan-to-value, with a £1,995 fee. It also has a two-year fix at 2.48%.

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