More lenders announce rate cuts
January 8, 2008
Following the Monetary Policy Committee meeting in December the Bank of England announced that the base rate would be reduced by 0.25%. This followed a series if five interest rate rises since August 2006 and several months of rates sitting tight at 5.75% since July 2007.
The 0.25% cut in December saw the base rate fall from 5.75% to 5.5%, and experts are predicting that this year will see further interest rate cuts, with some even predicting that rates could fall as low as 4% by the end of 2008.
After the announcement about the rate cut was made a number of lenders announced that their customers would be getting the full benefit of the rate cut. However, there were concerns that not all lenders would be passing the rate cut on.
However, announcements about rate cuts on mortgage products have been slowly filtering through from lenders. The stricken Northern Rock has recently announced that it will be cutting some of its rates. With Northern Rock you qualify for a loyalty discount after seven years, and the loyalty rate will 7.44% from this month. For existing borrowers the standard variable rate will go down by 0.15% to 7.69%.
The Abbey has also reduced some of its rates in a recent announcement. Interest rates will be cut by up to 0.1% on many of the mortgage products on offer from this lender.
An official from the Abbey stated: “Intermediaries looking to offer their customers a fixed rate mortgage during this uncertain period will benefit from a 0.1% cut in rates on a number of our most popular fixed rate products. Our long term fixes are extremely competitive with 10 or 15 year deals starting from as little as 5.64%.”
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