Mortgages: base rate cut to 1.5%

The Bank of England today cut the base rate by half a percent to 1.5% – the lowest rate since the Bank was established in 1694 – leading existing and would-be homeowners to hope for further reductions in mortgage rates.

Homeowners on some tracker mortgages will automatically benefit from the 0.5% cut, while people looking to take out a mortgage in the near future will hope that lenders also cut rates on fixed-rate mortgages.

However, a number of tracker mortgages carry ‘collars’ which prevent their interest rates falling below a certain level, meaning that some people on tracker mortgages will not receive the full cut.

A mortgage expert for Think Money commented: “Any base rate cut is welcomed by the mortgage market in general. Not everybody will benefit, but many will enjoy lower mortgage payments, and it also improves the long-term chances of fixed-rate mortgages becoming cheaper.”

---

Think Money work with a panel of lenders to offer a range of mortgages. If you are thinking about getting a mortgage, contact one of our expert mortgage advisers today.

Tags: mortgage, mortgages, mortgage base rate, base rate, base rate cut, tracker mortgages, tracker rate mortgages, fixed mortgages, fixed rate mortgages

Fees payable when continuing service is provided. Repaying debt over a longer period may increase the total amount to be repaid. Calls are recorded and are usually free from UK landlines. Mobile phone users may be charged and should check with their service provider. Cards are provided by third parties and are subject to eligibility, status and terms and conditions. Applicants must be UK residents aged 18 or over.