More than 2,000 different mortgages available

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The Independent Online

The number of different mortgage products available has broken through the 2,000 barrier for the first time in more than a year, figures showed today.

There are now 2,003 mortgages to choose from, with lenders launching more than 400 new deals since the beginning of the year, according to financial information group

The last time there were more than 2,000 different home loans on offer was on December 4 2008.

But availability dived to just 1,783 mortgages overnight as lenders scrambled to pull their tracker deals after the Bank of England cut interest rates by one percentage point to 2 per cent.

Moneyfacts said the increase in mortgage availability is a further sign that competition is slowly returning to the market.

Lenders are also beginning to loosen their lending criteria, after 12 months of house price rises have made them more confident about advancing money to people borrowing a high proportion of their property's value.

There has been a 38 per cent increase in the number of mortgages available to buyers with only a 10 per cent deposit since the beginning of the year, while deals for people with a 20 per cent and 15 per cent deposit have soared by 58 per cent and 28 per cent respectively.

Two new products have also been launched for people borrowing 95 per cent of their home's value, taking the total to 11, although this remains well down on the 1,079 mortgages that were available in July 2007, before the credit crunch first struck.

Meanwhile, mortgage rates are also continuing to edge down, with the average cost of a two-year fixed-rate deal dropping by 0.1 per cent to 4.78 per cent since the beginning of the year, while the cost of three-year fixed-rate loans has fallen by 0.2 per cent, and five-year ones are 0.12 per cent cheaper on average.

The figures come the day after the Council of Mortgage Lenders released data showing that mortgage lending had fallen to a 10-year low during January.

The group blamed the dip on a lull in the market after buyers rushed to push through the purchase of lower-value properties before the Government's stamp duty holiday came to an end at the beginning of this year.

Darren Cook, spokesman for Moneyfacts, said: "Mortgage lending is down and prospects for the future mortgage market look uncertain, but we can positively say that mortgage rates are heading in the right direction.

"It seems that the Bank rate will remain at 0.5 per cent for a while after the election.

"New mortgage rates are steadily reducing and there is a modest return of competition, but an appetite to lend looks to continue to be missing from the equation at the moment."

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