Abbey cuts mortgage interest rates

Published: April 22, 2008

Abbey has announced that it is to cut some of its mortgage interest rates.

It follows yesterday's (April 21st) Bank of England announcement that it is to launch a plan to ease the credit crunch.

The lender said that mortgage interest rates on a number of its deals will be cut by 0.1 per cent.

The bank's two-year tracker and flexible-rate mortgages will be affected as of April 30th 2008.

"Abbey welcomes and supports the Bank of England's decision to broaden its range of accepted collateral. It is an important step in bringing greater liquidity to the market," said an Abbey spokesman.

"We believe that this extra funding will, in time, reduce Libor [London Interbank Offer Rate] and in anticipation of this we have decided to reduce rates on tracker and flexible deals by 0.1 per cent.

"We will continue to review the cost of funding and will look to reflect further changes in our mortgage range going forward," he continued.

Recent cuts to the base rate of interest have boosted borrowers, with the rate falling from 5.75 per cent to five per cent between December 2007 and April 2008.