In further signs that competition may be returning to the mortgage market, three of UK's major lenders have cut rates on a number of their deals.

The Woolwich, Northern Rock and Abbey reduced interest rates across a range of their products, while HSBC said it was extending its 1.99% discount offer until the end of this month.

The Woolwich, the mortgage arm of Barclay's, headed to the top of the best-buy list after offering its lifetime tracker 0.45% lower at 2.79% for borrowers with a 30% deposit.

It also announced a fee-free lifetime tracker at 3.19% for people borrowing 75% of their home's value.

The launch was followed within hours by an announcement from nationalised bank Northern Rock that it was cutting the rate on its two-year tracker by 0.2% to 2.79%.

The deal is also for people with a 30% deposit, but has a lower fee than the Woolwich's lifetime mortgage of £595.

The group also reduced its fixed rate mortgages by up to 0.3%, leaving a two-year fixed rate deal for people buying a home with a 30% deposit at 3.75%, while its buy-to-let rates have been cut by up to 0.6%.

In addition, product fees on its residential mortgages have been reduced by £400 to £595.

Meanwhile, Abbey cut its fixed rate deals by 0.11%, leaving a two-year fixed rate mortgage at 3.88% for buyers borrowing 70% of their home's value and paying a £995 fee.

It also launched a two-year tracker with a rate of 2.94% for all borrowers with a 30% deposit who pay a £995 fee. All the deals are also available through Alliance & Leicester branches.

Ray Boulger, senior technical manager at John Charcol, said: "We are beginning to see a little bit of competition coming back into the market, but that's not to say we are going to get back to the stage where they are competing for higher loan to value business."

Copyright © Press Association 2009