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Borrowers are moving away from fixed-rate mortgages to take advantage of rock bottom variable rates, new figures show.

Although 77.6% of borrowers took out a fixed rate loan in the first quarter, that was down from 82.2% in Q4 2014 and 81% year-on-year.

Over the last 12 months the average variable rate loan has fallen from 2.94% to 2.58%, encouraging more borrowers to give up the safety of a fixed rate.

The FCA's latest Mortgage Lenders and Administrators statistics show that the average fixed rate loans shrunk from 3.32% to 3.13% over the same period.

Brian Murphy, head of lending at Mortgage Advice Bureau (MAB), said consumers are winning the mortgage price war, with interest rates on new loans falling to their lowest point since the Bank of England began recording data in Q1 2007.

"Mortgages have never been so affordable, and this is having a significant impact on borrower behaviour.

"More borrowers are now willing to move away from the safety of a fixed rate mortgage to take advantage of rock-bottom variable rates, with the proportion of new fixed rate loans falling below 80% for the first time in 15 months."

Murphy said conditions are failing to improve for those who want high-LTV mortgages. "Just 3.3% of all new gross advances in Q1 2015 were at an LTV of over 90%, the lowest proportion since Q4 2013.

"With no hint of an extension of the Help to Buy guarantee scheme - and house prices continuing to climb - the prospect of having to save for a hefty deposit may leave some borrowers priced out of the market if the availability of high-LTV loans does not improve."

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