Mortgages drop back

Total mortgage lending reached £25.2bn last month, 2% less than during June and 13% below the levels seen in July last year, according to the Council of Mortgage Lenders.

It said the figures indicated the housing market had started to stabilise at a new, lower level, last seen in 2003. The group added that 50% of people taking out a mortgage that month opted for a fixed-rate loan, the highest proportion since December 1998.

July also saw the average rate of a fixed-rate product fall for the ninth month in a row to 5.31%.

West Bromwich building society tops our table of best buy fixed-rates with a two-year deal at 4.15%. Like the Halifax's 4.29% two-year fix, it comes with a whopping £599 sign-on fee, which strips the deal of some lustre, especially if the value of the mortgage is below £100,000, when these fees really begin to bite.

Nationwide is probably the best option. It is offering a fixed rate at 4.39% with no legal or valuation fees for remortgagers and at the end of the deal you can switch.