Irish Permanent, the State's largest mortgage lender, and First Active were the first two institutions to cut fixed rates in response to the recent dramatic decline in the cost of borrowing funds on the financial markets.

Their move was quickly followed by a number of other financial institutions, including EBS Building Society and Bank of Ireland.

Many of the new raft of fixed rates are under 6 per cent. Bank of Ireland, for example is marketing a two-year fixed rate of 5.85 per cent, ICS has one at 5.89 per cent while EBS has a three-year rate on offer at 5.85 per cent.

Some institutions are also offering heavily discounted rates for new customers to entice them in. For example, Bank of Ireland and ICS are both offering one-year fixed rates of 4.90 per cent and 4.95 per cent respectively to new borrowers, while Irish Permanent's one-year rate for new borrowers is pitched at 4.94 per cent.