4 August 2016 – Bank of England cuts interest rate to 0.25%
Fri 5 Aug 2016
On 4 August 2016 the Bank of England cut the UK interest rate from 0.50% to 0.25% – a record low and the first cut since 2009
This is GOOD news for those having a mortgage or thinking about getting one!
Using Office for National Statistics (ONS) house price data, a cut to 0.25% means a £22 monthly reduction in the bill for a variable 25-year repayment mortgage on a typically priced home of £211,000 having taken a 20% deposit into account.
Those who will see an immediate benefit are those on Bank rate tracker mortgages – in other words, home loans with an interest rate that goes up or down in direct relation to the Bank of England’s decision: 1 in 5 mortgage holders have this type of loan.
Approaching a third of all mortgage holders have home loans that are on the standard variable rate – the default option after a fixed term has run its course. They will be in the hands of the lender. Some mortgage providers may pass on the cut in full, some may decide on a partial cut, others may make no change at all given the historical low levels on interest rates.
For any residential requirement please contact Hamilton Stiller today!