Borrowers are facing a bewildering range of options when it comes to financing their home purchase. Not only do variable rates vary hugely between one lending institution and another but the sheer variety of fixed-rate loans, special discounts and tiered loans would confuse all but the most dedicated observer of lenders.

The main rate which borrowers should always look at is the variable rate. Not the discounted variable rate, which lenders often offer for the first year of the loan. Admittedly, this discounted rate can be very handy for those moving into a home. The first year can often be the most expensive, with the homeowner having to foot the cost of repairs and alterations to a greater degree than normal, as well as trying to furnish their new home.

But it is important to remember that for the vast majority of the life of your loan you will be paying the lender's variable rate.

This is, of course, also true for anyone thinking of taking out a fixed-rate loan. Many a borrower has been tempted by what looked like a fixed rate which was almost too good to believe only to discover that they were paying more than others when the loan reverted back to the variable rate.

Of course, the cost per thousand column in the mortgage table is also very important. This is very useful for anyone trying to work out how much they can afford. For example, if you were thinking of taking out a £75,000 loan, you would simply multiply the cost per thousand of say EBS's variable rate at 6.52 by £75. The £489 is the amount you could then expect to pay monthly.

All the lenders also have to advertise the annual percentage rates, or APRs, on their products. These often cause the most confusion. They can vary hugely from one lender to the next who offers the same variable rate. This is because they also take into account the cost of the mortgage after the period of the fix or discount.

As a result a lender with a higher variable rate than another but offering the same fixed rate would have a higher APR.

For example, Bank of Ireland's 5.1 per cent three-year fix has an APR of 6.64 per cent, while Irish Permanent's 5.1 per cent three-year loan has an APR of 6.65 per cent. And larger difference frequently occur.

Over the past number of years EBS has been consistently the cheapest lender. At the moment, it is the only lender with a standard variable rate below 5 per cent at 4.85 per cent. Others range from TSB's 5.15 per cent to Ulster Bank's massive 5.53 per cent.

The lenders have been coming under increasing pressure to cut these still further. And even the National Competitiveness Council took them to task this week for charging more than other banks across the EU.

Only EBS charges less than double the amount they get the funds for on the market, which is currently only 2.5 per cent.

More people are also now looking at fixed rate loans. With official rates now at 2.5 per cent, it is hard to imagine them falling much further. Although it is, of course, possible that mortgage rates will fall further or that the entry of European lenders into the market who would shake things out.

At the moment, the best value fixed rates are those under 5 per cent. On a long-term view, they are hard to beat. The one-year fixed rates are often significantly lower but rates may have moved upwards by the time you come out of that, making repayments more expensive quite quickly.

First Active has a one-year fix at 4.25 per cent, as does Irish Nationwide and National Irish Bank. AIB, EBS, ICS, and TSB all offer a 4.4 per cent rate or less.

But, generally, it may be a better idea to go for a three-year or even a five-year rate. Many of the lenders will also be prepared to be more flexible with the amounts they lend if they know you are going to fix your repayments.

Several lenders are offering three-year rates at less than 5 per cent. These include EBS at 4.9 per cent, First Active at 4.95 per cent, ICS at 4.99 per cent and Irish Nationwide at 4.95 per cent.

The five-year loans are mostly just over 5 per cent, although Irish Nationwide does offer a five-year fix at 4.95 per cent. Other lenders with reasonable deals include AIB at 5 per cent, Bank of Ireland at 5.2 per cent, EBS at 5.1 per cent and First Active at 5.2 per cent.

Irish Permanent, the country's biggest lender is also by far the most expensive in this category at a very expensive 5.95 per cent.