As forecast by many, the Bank of England’s Monetary Policy Committee cut bank base rate by 0.25% to 5.00% today. Early signs are that lenders are passing on the full cut to existing borrowers on tracker and variable deals, but most lenders are yet to make an announcement.
Exactly what benefit this cut will bring to those borrowers currently looking to move home or remortgage remains to be seen, as lenders continue to struggle with funding issues and servicing of existing applications. The rapid withdrawal of mortgage schemes seems to be one way lenders have of managing this, and in most cases, the replacement products have been higher.
Base rate is now at its lowest point for over 12 months, but concerns remain that this cut will not be enough to alleviate the problems in the market and lead to cheaper mortgage rates.
While the move is welcome our advice to borrowers remains the same. Start your search early and once you’ve found the mortgage you want, act fast to secure funds.
If you are unsure whether rates will rise or fall, and don’t want to commit too early, take advantage of our Ratecheck service. Ratecheck will ensure you don’t miss out on any short term falls, but importantly you can secure the best available funds now, should rates rise. For more information call 0800 373 300