Alliance & Leicester is cutting its flexible mortgage rate to 7.49 per cent from 7.64 per cent after reductions in the Bank of England's base rate.
A&L's flexible mortgage lets borrowers make overpayments which cut total interest repayments.
This could shorten the term of the mortgage. There is no minimum or maximum overpayment and borrowers can build a credit facility to take repayment breaks, make underpayments or borrow back at a later date. Loans are available for up to 95 per cent loan to value.