Fixed is looking even better bet

While interest rates stayed on hold this week, murmurings about a possible rate rise soon to rein in runaway consumer spending have made fixed-rate mortgage deals look extra-attractive.

The not-so-good news is that recently a number of lenders have withdrawn or repriced upwards their fixed rate mortgage offers in response to some experts' predictions that interest rates will rise later this year.

But the good news is that there are still some great deals around for home-buyers and remortgagers keen to fix their monthly home loan payments.

However, they are unlikely to be available for long so borrowers need to act quickly, says mortgage broker Charcol.

Its pick of the offers is Northern Rock's deal fixed at 3.99% for two years (until April 1, 2004) for loans up to 75% of the property's value - or 4.29% for loans up to 90%, rising to 4.39% where the borrower can only manage a deposit of 5%-10%.

"These deals really buck the trend and are currently the cheapest two-year fixed rates available," says Ray Boulger at Charcol.

The loans are flexible and there is an early redemption penalty of 2% until April 1, 2004, with no penalty after the fixed rate period has ended. But, there is a £395 lender's arrangement fee.

Borrowers looking for slightly longer-term rate security may want to opt for Portman building society's new three-year deal fixed at 4.99% until March 1, 2005. Minimum deposit is 5%.