Post Office mortgage rate cuts could boost equity release market

Homeowners with Post Office mortgages may be more likely to benefit from equity release schemes in future after the organisation lowered its interest rates.

For the fourth time this year, the Post Office has cut the rates on its fixed-rate home loans as part of its ambition to become a leading player in the UK mortgage market.

It claims that its new two-year and five-year fixed-rate deals are set to become immediate Best Buys alongside its existing three-year product.

The Post Office's new two-year fixed rate deal is set at 3.15 per cent (75 per cent LTV), while its five-year offering comes in at 4.84 per cent (80 per cent LTV).

"These reductions further prove our commitment to providing genuine value, not just for the initial period, but throughout the life of the mortgage," said Post Office director of personal lending Marco Hughes.

Meanwhile, top-rate taxpayers who want to make their money work harder have been advised to consider opting for offset mortgages as opposed to placing funds into savings accounts.

Moneysupermarket.com claims that there is presently no savings account in the UK that will deliver a real return for those in the 50 per cent income tax bracket.

Ashall Glover Financial Services are equity release specialists