Mortgage rates have reached an all-time low with the launch of a new 0.79% deal, the lowest ever recorded in Britain.

Since May of this year, and for the first time in almost four years, homebuyers have been offered mortgages with interest rates below 1%.

There are now 140 deals available with an interest rate of sub-1%, as lenders make the most of their ability to borrow money cheaply from the Bank of England with the base rate at 0.1%, financial analysts Moneyfacts said.

Platform, part of the Co-operative Bank, has undercut its competitors, having launched a two-year fixed-rate loan at 0.79%.

Borrowers must have a 40% deposit and pay a £1,499 arrangement fee to take out the Platform loan. Even with the large fee, Lewis Shaw, founder of Mansfield-based Shaw Financial Services, this deal will prove popular with homebuyers.

He said: “This is yet another sign that lenders are going toe-to-toe in a bid to entice top quality, low-risk customers onto their books. By dangling these kinds of rates in front of borrowers they’re sure to succeed, too.

“If you’re in the market and have at least 40% equity or deposit, you’ll need to strike while the iron is blisteringly hot, because deals like this don’t come around every day of the week. In fact, they’ve never come around ever. Who knows whether a lower rate will emerge, but be under no illusions that this kind of rate competition won’t last for long.”