Bank Rate kept at 0.1%

The Monetary Policy Committee voted unanimously to maintain #BankRate at 0.1%. https://t.co/p9P9WV3T0U pic.twitter.com/ZZXgU0AdUU

— Bank of England (@bankofengland) November 5, 2020

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MPC vote to keep bank rate at 0.75%

MPC voted by a majority of 7-2 to keep #BankRate at 0.75% https://t.co/CCBAgbZL56 pic.twitter.com/DrmEJMv2rS

— Bank of England (@bankofengland) December 19, 2019

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BTL rates see record rise

Buy-to-let rates see record rise https://t.co/I2YDokxjcf

— FTAdviser (@FTAdviser) December 5, 2017

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BofE policymaker urges rate rise

Bank of England policymaker urges rate rise https://t.co/U5ltB8qRk9

— FTAdviser (@FTAdviser) September 6, 2017

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No rate rises until 2019

No rate rise until 2019, economists say https://t.co/UCE3FQsAAG

— BBC Business (@BBCBusiness) September 3, 2017

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Inflation fall lessens rate hike pressures

Inflation falls and lessens rate hike pressure https://t.co/BsmbLbqn0s pic.twitter.com/naOprCvZ9b

— Mortgage Introducer (@MortgageChat) July 18, 2017

UK inflation unexpectedly slows to 2.6% in June https://t.co/9yq1kdo0L3

— Eric Walker (@JustEricWalker) July 18, 2017

UK inflation falls for first time in nine months https://t.co/sfXafQRhSl

— Guardian news (@guardiannews) July 18, 2017

Pound falls as inflation fall dashes rate hike bets https://t.co/LgOLnauBEK

— Citywire Money (@CitywireMoney) July 18, 2017

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BofE deputy against rate rise

Bank of England deputy says it is not time for interest rate hike https://t.co/Lvr5AgT0OE

— Guardian news (@guardiannews) June 28, 2017

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Hints of a rate rise

Bank surprises with interest rate vote https://t.co/JJfEl3C9kS #property

— NorthwoodUK (@northwooduk) June 15, 2017

Pound soars and FTSE slumps as Bank hints at rate rise https://t.co/EALKtaFvbJ

— FTAdviser (@FTAdviser) June 15, 2017

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BofE keep base rate at 0.5%

The Bank of England have kept the base rate at 0.5% despite all the talk of dropping it to 0.25%.

Monetary policy summary and minutes of the MPC meeting ending on 13 July 2016 https://t.co/KxIXEgjl8c #BankRate pic.twitter.com/XZlgUZIV0c

— Bank of England (@bankofengland) July 14, 2016

Bank of England leaves UK interest rates on hold at 0.5% https://t.co/MPGUK7IYUZ

— Guardian news (@guardiannews) July 14, 2016

Bank of England dashes expectations of rate cut https://t.co/8WVDN5VKbw

— Citywire Money (@CitywireMoney) July 14, 2016

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Base rate stays at 0.5

The Bank of England has continued to hold the base rate at half a percent for the fourteenth month in a row.

BofE keeps base rate on hold - Independent
Base rate stays at 0.5 - Times
Interest rate kept at historic low - BBC

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Possession hearing: When you arrive for your hearing

People behind with payments on their homes have a new way of finding the best solution to their arrears problems. These new animated videos, interview clips and articles, created by the Ministry of Justice and available on Directgov, go from the point where there may be a problem, to communicating with landlords or mortgage lenders, how to prepare for court and what happens during and after a court hearing.




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Base Rate remains unchanged at 0.5% - 09.04.2009

As expected, the Bank of England have kept Base Rate on hold at 0.5% this month, halting the steady trend of reductions over the last few months. With the MPC’s ammunition more or less spent in this area, all eyes are now on the Bank’s Quantitative Easing programme designed to stimulate the much need liquidity into the market.

Mortgage rates would appear to have bottomed out and now is the time to act if you are looking for competitive Residential mortgages or Buy to Let mortgages. Fixed Rates are proving popular with both homeowners and investors with many borrowers now looking to lock into 2, 3, and 5 year rates before the cost of funds starts to rise over the coming months.

With regards to Commercial Mortgages, there are again some good deals to be done whether you are an investor, developer or are looking for premises for your own business. Despite what you read in the press, Banks are lending and with the cost of funds relatively low, there some very attractive commercial rates available for the right deal.

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Will everyone benefit from the 0.5% cut in Base Rate?

Media and politicians focus on residential mortgages when Bank Base Rate (BBR) is cut as that is the point of maximum impact on individuals and ultimately where votes in the next general election will be won or lost.

Much media focus over the last 5 months has focused not only on how much lenders reduced their SVR but also on the date at which it will be implemented. This is monitored very effectively by the BBC on http://news.bbc.co.uk/1/hi/business/7872344.stm and you can see who passes on what amount and how quickly they do, or don't, apply it. You can also see our own graph below.

Many residential mortgages are on fixed rate mortgages of 2, 3 or 5 year duration. These borrowers will generally be paying mortgages between 4.75% and 6.75% and will be looking carefully at the clause that identifies what price they will pay after the initial fixed rate period. The majority will revert to the lender's standard variable rate (SVR) which is at the lender's discretion and currently varies from 3% to 5.79% (ignoring one lender with an eye watering 8.44%). Several have already stated their intent to pass on the latest rate cut in full (Nationwide, LLoyds, HBOS and Woolwich) but this will still mostly be on a margin greater than Base + 2%. Borrowers should also check that their mortgage doesn't include a "collar" that would impose a minimum interest rate - for example 3%. The most fortunate borrowers are those who have a Bank of England Base Rate (BBR) linked mortgage where the 0.5% cut is applied with immediate effect !

For the very small group of borrowers who have a mortgage headline rate with a discount of 1% or more to BBR , there is the delightful prospect of a negative interest rate. In reality this simply won't happen but there doesn't yet seem to be an industry wide solution to this conundrum. Even when this is agreed, I doubt whether most lenders computer systems will cope !!

Buy To Let borrowers mostly benefit from mortgages that are linked to BBR or LIBOR rate and will have enjoyed ever improving cashflow in recent months. We have not identified any "collar" clauses in the Buy to Let mortgage sector. Some borrowers will be on SVR with a lender and if that lender is no longer actively supplying new mortgages they may not be passing on BBR cuts in full to borrowers - 4.84% SVR doesn't seem expensive until you equate it to BBR + 3.84%. Refinancing these mortgages to other lenders can sometimes also release equity for further purchases if gearing is relatively low.

Business borrowers are invariably funded to BBR or LIBOR rate - sometimes lenders will stipulate that loans above £1M, must be funded to LIBOR to mitigate risk. A few banks will offer "dual pricing on each transaction - BBR + 2.75% or LIBOR + 2% ie the differential between the LIBOR and BBR in the money markets. For these borrowers the issue isn't so much price as the availability of credit !!

The Government will maintain its focus on BBR and cite any lender as irresponsible who doesn't match the BBR reductions regardless of the real funding cost either from wholesale funds or from retail deposits. And of course this portrays them as the consumer's champion which will be important as a general election approaches; but now that they (and us as taxpayers) have significant stakes in both RBOS and Lloyds HBOS and full ownership of Northern Rock and Bradford and Bingley, they need to be mindful of their investment in these institutions when they issue headline grabbing statements.

By clicking on the below you can see a consolidated list of lenders and any benefits they have passed on. We will be updating this as things develop.