Interest rate to fall to record low

According to latest Bank of England forecasts inflation could well be an old problem. The new risk to the economy is deflation - falling prices. Inflation was before the Bank of England's dramatic 1.5% cut to 3% last week, expected to fall to less than half its 2% target as food and energy prices fall back and demand eases in a looming slowdown.

Before the Bank's mammoth cut last week, markets assumed the base rate would fall to around 2.75% by the end of next year. Many experts now predict rates tumbling below the all-time low of 2%, and the Bank's forecast offers support to this view.

To capitalise on falling interest rates landlords might want to look at a new mortage being offered through the Moneycentre

They are offering a 5.34% lifetime variable rate with no fees

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5.34% Lifetime Variable (lender’s standard variable rate (SVR))
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° Borrow up to 65% of the valuation amount or purchase price,
whichever is lower
° To calculate the maximum loan amount you could borrow multiply
the monthly rent by 224.75 (subject to maximum 65% of valuation amount)
° No lender's arrangement fee
° Free valuation up to £680
° Early repayment charge of 3% of the amount repaid up to
30/09/2013

For loans up to 50% of the property value the lender does not
have a minimum rental income requirement. For loans of 50% or more (up to
65%) the rental income has to match the interest only monthly mortgage
payment.

A broker fee may be payable