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Mortgage firm withdraws fixed rate loan

In a further sign of the increasing nervousness of banking giants in the credit crunch, Alliance & Leicester has withdrawn its two-year fixed rate mortgage loan offer.

Previously, this loan product was on the market at 4.99 per cent - making it one of the more competitive deals on the market.

However the general raising of rates at many of the firm's rivals, including HBOS and Nationwide, could have led the loan towards becoming a victim of its own success.

Head of mortgage products at Alliance & Leicester, Richard Taylor, said: "Over the past few days we have seen a high demand for our 4.99 per cent two year fixed rate product.

"Therefore we have taken the decision to remove it from the range, in order to manage the volume of business we are receiving at present."

According to figures from Moneyfacts.co.uk, the number of mortgage products available across residential and buy-to-let markets has dropped from 7,726 to 5,700 in the past month.

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