Base Rate Cut not passed on by three quarters of lenders.

unite79

Lucky you, lets hope they don't wriggle out of it...............
Small print somewhere - We are seeing caveots about minimum base rate,,,,,

Iceland - Prefer to go somewhere hotter - If its going to be pointless.

broke_mum_of_three

Ian_Griffiths_Halifax wrote: »

Alliance & Leicester cuts SVR

21 October, 2008

Alliance & Leicester today announces a reduction in its Standard Variable Rate (SVR) from 7.19% to 6.94%, a reduction of 0.25%. The new rate will come into effect on Thursday 30 October.


Existing Alliance & Leicester customers on SVR or SVR related discounted products will see the change in their mortgage rate from Sunday 2 November.

The rate on Alliance & Leicester Base Rate Tracker products for new customers reduced by 0.50% on Monday 13 October in line with the reduction of the Bank of England base rate. Existing customers with a Base Rate Tracker mortgage will see their rate reduced by 0.50% from Saturday 1 November

Got my letter yest to tell me our base rate tracker mortgage is being reduced by 0.5% from 1 November, just in time for our next payment:beer:

Old_Git

am I correct in thinking woolwich didnt pass on the interest rate cuts on its tracker deals .

Mithos

Gorgeous_George wrote: »

You borrow from the bank.

The bank borrows from the MARKETS - not necessarily at Bank of England base rate but at LIBOR (London Inter Bank Offer Rate).

Therefore, mortgages are more likely to follow LIBOR than BofE Base Rates.

GG

Sorry for being dim (I've enjoyed learning from your posts though!) But what in the case of Building Societies? Don't they borrow from their savers? In which case if they are paying 5.5% on an account should their fixed rates/SVR for existing borrowers not be more in reflection to that?

MarkyMarkD

Some good points coming through in this thread - thanks all.

Regarding building societies, YES they get their money from savers. But their savings rates are NOT falling - certainly not by the 0.5% - because if they do so, the building societies will lose balances and have a liquidity disaster.

Building societies' costs have been forced up because the banks, who were traditionally more reliant on wholesale funding, have been offering ludicrously high savings rates to get some retail funds in instead.

Re Mithos's comment - of course, the SVR for existing borrowers is related to the (say) 5.5% they are paying on savings accounts. But they also need to make some margin to cover their costs, their arrears, their defaults - which are increasing dramatically right now. And they are also losing money on a lot of their recent lending at either discounted or tracker rates, which were priced at a point when savings rates were far lower compared to BBR than they are now.

financiallyilliterate

olly300 wrote: »

I think it's time for you to email the chancellor courtesy of Which -
http://www.which.co.uk/campaigns/banking-crisis/about-the-banking-and-credit-campaign/banking-crisis/index.jsp

That link doesn't work, but this is the right one

http://www.which.co.uk/campaigns/banking-crisis/banking-crisis-email-the-chancellor/index.jsp

Jimbo65

Egg are still to pass on any rate cut yet, despite a Libor rate of 4.2%, a whole 2.5% below there SVR.....today they say they are waiting to make an announcement, as they said last week, and the week before that too. Waiting for what I wonder, the 9.27 from Victoria? They couldn't tell me either what it was exactly they were wwaiting for, nor could they tell me the current Libor rate, so I told them (invoice to follow naturally)
GE Money, bless there little cotton socks, ramped there rates up notifying customer by post today, by a whopping 1.95% to 13.15%. That is a full blooded spiv rate 10.15% above BoE rates and nearly 9% above Libor rates banks have been telling us these past 6 weeks influence lending rates. Am I missing something here?
I can see it coming to riots, which I do not condone, but Government appears impotent. GE will make people and families homeless in time for Christmas with this scandalous decision, I hope they burn in hell.

gallygirl

Jimbo I'm sure you'll be delighted to hear Egg have just notified me of my rate cut...... 0.25%. However, this is based on Oct cut, Nov cut is also being passed on in full - possibly only because I have a tracker mortgage, I couldn't get confirmation of what was happening to SVR.

I was a big fan of Egg till Citigroup took over. Will be surprised if latest 1.5% is passed on to SVR - they're obviously trying to get rid of all mortgages - not offering new ones and pricing out the ones they have. Well, as far as I'm concerned I'll be assisting them in paying mine off asap - & latest rate cuts will help tremendously :T, on my 2 products with them I will be on 3.74% and 3.99% :j