Remortgage time? Act quickly mortgage experts urge

Better mortgage deals could be on the horizon after the world central banks' provided a £54 billion injection of cash to the money markets last month.

That is according to predictions of independent mortgage experts, John Charcol, responding to news the three-month LIBOR – the interest rate at which banks borrow money – has dropped from 6.65 per cent to 5.89 per cent.

If banks can now borrow money cheaply, said John Charcol, then they can lend money more cheaply which is excellent news for borrowers.

And with interest rates set to fall again this month it has urged anyone who is set to remortgage soon to act quickly to avoid shifting to their lenders' standard variable rates (SVR) – a move which could lose them money.

Katie Tucker, technical manager for John Charcol, now expects a number of new product ranges to emerge this week which borrowers can take advantage of.

"SVR changes announced at the bank rate cut last month were dated mainly for January 1st, so many lenders are now operating on variable rates reduced by 0.25 per cent, another long-deserved respite for borrowers with discount rate mortgages," she said.

"Only a few of the smaller banks and building societies seem to have not passed on the full reduction."

Ms Tucker has picked out Coventry's new two-year fixed rate of 5.49 per cent with a £999 fee for its flexibility. And she said Britannia had the lowest five-year fixed rate at 5.39 per cent with a £999 fee.

She also highlighted Lloyds TSB's tracker at 0.62 per cent below the base rate until April 2010 and the Co-operative Bank's 5.49 per cent mortgage which is at 0.01 per cent below the base rate for two years.