Society bucks the trend on fixed rate

Stroud & Swindon building society this week cut its fixed-rate mortgage offer, bucking the current trend for lenders to raise fixed rates.

The society said customers could opt for a fixed rate at 4.6% running for up to two years and four months.

But it has a sting in the tail - a three-year tracker that adds 1.24% to the Bank of England base rate and comes with redemption penalties starting at 3% in the first year.

Nationwide has followed the trend set by most rivals and hiked its two-year fixed rate by 0.2 percentage points to 5.29%. Its five-year fix rises by 0.15 percentage points to 5.74%. Cheltenham & Gloucester, the UK's third largest lender, has also raised its fixed rates. A two-year fix is 5.49%, falling to 5.29% for mortgages of more than £100,000.

According to mortgage broker Savills, Britannia Building Society offers the best buy fixed rate at 4.49% on purchases and remortgages up to 95% loan to value. Redemption penalties apply in the first two years. Chelsea Building Society has a 4.69% fix until June 2004.

Mortgage experts say if you can afford to choose discounted variable rate deals they offer much lower rates.