Mortgage blog: Be prepared for a great mortgage deal as price war escalates

Posted 23 October 2014

If you’re looking for a mortgage in the final quarter of 2014 then you could be set for a terrific deal. A mortgage price war is intensifying as lenders fight to increase their market share having reduced the availability of home loans since new rules were introduced in April.

The Bank of England’s latest Credit Conditions report has revealed that lenders expect to increase the availability of mortgages in the fourth quarter after a sharp contraction in activity in the three months to September.

After several months of restricting home loans, banks and building societies are now engaged in a battle for market share. Recent weeks have already seen a number of price cuts as well as offers including free iPads and cashback towards council tax payments.

Keith Osborne, editor of, says: “Most experts correctly predicted that the supply of home loans would fall after the introduction of tough new rules and because of concerns over rising house prices. Now, though, lenders have realised that they are falling short of their mortgage targets and are now fighting to bridge the gap. To generate new business lenders have been forced to offer attractive deals and this has resulted in falling mortgage rates.”

James Knightley of ING Financial Markets agrees, saying that lenders’ predictions of a big rebound in availability “suggests that there should be some good mortgage deals becoming available in coming weeks”.

The Credit Condition report found that lenders had also increased the availability of unsecured credit, through products like credit cards and personal loans, and expected to further increase this type of lending before the end of the year.

Despite the prospect of a base rate rise, mortgage rates have fallen over recent months. It is now once again possible to fix your mortgage rate at below 3% for five years while there are lots of competitive deals available across all the loan-to-value bands.

Osborne adds: “Most of the major lenders have launched new deals over recent weeks. Banks are also trying to differentiate their offerings by promising unusual perks such as tablet computers and contributions towards council tax payments. With just three months of the year remaining many banks and building societies are well short of their mortgage lending targets. This means that competition is fierce and there should be plenty of great deals available between now and the end of 2014.”

Click here to find out more about how can help you find the right mortgage.


Click here to see your activities