Belfast Telegraph

Leading mortgage lender cuts rates

By Symon Ross

Ulster Bank announced today that it is cutting the rates on three of its mortgage products as it looks to meet its commitment to lend £500m for mortgages by the end of the year.

The bank said it is reducing three of its offerings, including a two-year discounted variable rate for lending up to 75% loan to value, which is being cut from 3.19% to 2.99%.

It is also cutting two of its two-year fixed rate deals - the rate for loan to values up to 75% is being reduced from 3.99% to 3.78% and the rate for loan to values up to 90% is being cut from 5.89% to 5.29%.

Lending criteria, terms and conditions apply to each of the deals.

Ulster Bank, part of nationalised Royal Bank of Scotland, lent more than £400m of new mortgages in Northern Ireland in 2009 and launched its £500m mortgage fund last month. RBS agreed to increase mortgage lending by £8bn earlier this year.

The decision to lower rates on some products comes after policymakers at the Bank of England this week opted to leave its base interest rate unchanged at a record low of 0.5% for the 14th straight month.

Rate setters are unlikely to change the base rate, which helps determine mortgage rates, until plans to restore the UK's public finances have been set out by a new Government.

Derek Wilson, Ulster Bank's head of lending products, said the bank would "love to see increased customer demand for mortgages in 2010" and that it had "substantial funds ready to help buyers".

He said the bank is committed to increasing its level of mortgage lending further and wants to see more demand from all types of mortgage seekers, including first-time buyers, movers and those trading up.