Best mortgage deals on the market

Buying a new home, particularly if you are a first-time buyer, might seem like an impossible task in the current climate but there is still hope if you are house hunting.

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In recent weeks some mortgage providers have begun to offer 90 per cent deals once again and one small bank, Aldermore, is even offering a 100 per cent mortgage for those with a guarantor.

Things are also looking promising for those who can raise a deposit, with fixed rate mortgages proving particularly tempting.

Many lenders are now luring buyers with five-year or even 10-year fixed rate options, giving borrowers a little more security in terms of repayments, while others are risking a slow interest rate rise with a tracker mortgage.

We take a look at a few of the best deals on the market.

Fixed rate mortgages
Although a tracker mortgage might get you a better deal in the short term, interest rates will rise sooner or later so if you are looking for security, a fixed rate might be the best option.

To get the best fixed rate deals you will need a deposit (40 per cent gets you the rock bottom interest rates).

Santander, for instance, are offering a 2-year fixed rate of 2.35 per cent with a 40 per cent deposit, while Chelsea Building Society (2.39 per cent) and Leeds Buildings Society (2.45 per cent) have similarly attractive offers on the market.

For those with a smaller deposit, the interest rates are obviously higher - Lloyds TSB are now currently offering a 3.94 per cent rate for mortgages with only a five per cent deposit (fixed until November 2014), while Chelsea and Yorkshire Building Societies can provide a 2-year fixed rate at 4.09 and 4.19 per cent respectively, with a deposit of 90 per cent.

If you want added security, consider a longer-term fixed rate. Both Chelsea and HSBC are offering five-year fixed rates (3.29 and 3.34 per cent, depending on your deposit) while the Yorkshire building society will lend at a 10-year fixed rate of 4.19 per cent with a 25 per cent deposit.

However, if you choose a fixed rate, do be aware that most require a set-up fee (typically in excess of £1,000) and early repayment charges usually apply. Check the small print to ensure you can take the fixed rate with you should you move home.

Tracker mortgages
The attraction of a tracker mortgage is that you'll be able to take advantage of the current low base rate.

Once again, those with a 40 per cent deposit get the best rates, with Skipton Building Society offering 1.98 per cent and Chelsea 1.99 per cent for two years.

Deals for those with a smaller deposit are similarly attractive - for a 75 per cent mortgage Yorkshire will offer a 2.29 per cent deal while with a 25 per cent deposit, Principality Building Society will charge 2.49 per cent until September 2014.

Once again, arrangement fees apply and you obviously run the risk of interest rates rising.

Fee-free discount, variable and fixed rate mortgages are also available, notably Barnsley Building Society, which is offering 2.69 per cent fixed for two years with a 25 per cent deposit, and ING Direct, whose discount mortgage requires a 40 per cent deposit at an initial rate of 2.5 per cent.