Post Office launches deals for first-time buyers

The group is offering four mortgages for people with only a 10 per cent deposit, two of which are best buys.

It also introduced a new range of mortgages for people borrowing 85 per cent of their home's value, all of which offer market leading rates.

Interest rates on its existing fixed rate mortgage range were also reduced for the fifth time this year, with the group cutting them by up to 0.36 per cent, while it is also offering a range of fee-free five-year fixed rate loans for people remortgaging.

The group, which is run as a joint venture between the Post Office and the Bank of Ireland, recently announced plans for a major expansion in the financial products it offers.

The push will also see it "significantly increase" its mortgage lending, with the Government saying it hopes the group will double the size of its mortgage book during the coming financial year.

The Post Office advanced 1bn during 2009, giving it a market share of between 3 per cent and 5 per cent. It currently offers more than 40 different mortgages.

Marco Hughes, Post Office director of personal lending, said: "Whilst there are existing 90 per cent deals available, many remain out of reach for most borrowers because the rates are too high.

"The latest additions to our range and the further rate cuts reflect our commitment to offer our customers market leading rates."

The group is offering a rate of 5.45 per cent on its two-year fixed rate mortgage for people with only a 10 per cent deposit and 5.99 per cent on its five-year one.

Both deals come with a 999 arrangement fee.