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Cheaper Mortgages ahead - The Sunday Times 2nd January 2005

Lenders are gearing up to slash their rates, but should you opt for a cheap fix or a discount, ask Clare Francis

Borrowers will be offered cheaper mortgages rates this month as lenders launch January sales to boost business.  Ray Boulger of Charcoal a mortgage broker, said: ''We expect the year to start with some very competitive deals flooding the market.  Lenders will be competing hard to maintain their business in a slowing housing market.''

Last week, HSBC became the first bank to open on a bank holiday when it launched a January sale on a range of products, inlcuding mortgages.  It is offering 25% off its standard one year fixed rate of 5.29%, so you would pay 3.97%.  Many other lenders are expected to launch cheaper fixed and discounted rates in the coming months.  Fixes are already at their lowest level relative to discounts for 18 months.