BOE Base Rate Cut by 0.25 to 5.5%

brightbuy

It would be interesting to hear some opinions on the recent base rate cut, I do not think we will see the lenders responding as quickly with their rates!

Most people aren't aware that lenders aren't obliged to follow suit with their variable rate mortgages just because the BOE have cut rates.

Is this just a ploy to get consumer confidence up before Christmas?

hellies

What does this mean for people with variable mortgages? sorry to seem a bit dense, just heard it on the radio

Dan_Collins_2

mmm a bit early for me, but I guess retail could do with some good news!

I agree with what you say about lenders brightbuy, if they dont have much money to lend then they need to make as much money as pos out of what they can lend. They have also funded until Feb with funds at a higher libor.

brightbuy

hellies wrote: »

What does this mean for people with variable mortgages? sorry to seem a bit dense, just heard it on the radio

Lenders aren't obliged to follow suit and with the credit crunch impact we will still see the lenders adhering to the stricter criteria and tighter controls that many of the mortgage advisors in here have explained for many months at least.

pollyanna24

How about if people take out tracker mortgages? Or will they just change the amount that it will track by?

For example, Nationwide have Lifetime Tracker of +0.34, will they just up this to say, +0.54 so they get the same amount?

sniperpenguin

I predict that most lenders will wait at LEAST 3mths before following up with their own cut (not necessarily .25% either!).

My work colleagues will be happy as they are both recent FTB-ers (although I think on a fixed rate deal - gutted!)

For me though.... lower savings rates, more idiots taking up mortgages... bad news

brightbuy

pollyanna24 wrote: »

How about if people take out tracker mortgages? Or will they just change the amount that it will track by?

For example, Nationwide have Lifetime Tracker of +0.34, will they just up this to say, +0.54 so they get the same amount?

Over the past few months I have been saying that a tracker mortgage would be a good option for the investors I deal with. Most people want the security of the fixed rates.

Like you say pollyanna, the lenders will not make it easy for you and could change or remove some of the tracker products on the market. Tracker mortgages must follow the BOE base rate. The lending criteria will be more strict for these mortgages.

cm233lh

I just moved to a tracker last week. I'm glad I did.

pollyanna24

When people say strict lending criteria, what exactly do they mean?

Is 3.2 x joint income, about 80% mortgage, no debt, no bad marks against your name and staying with the same lender all good?

rockrat

i personally believe that tracker mortgages over the LONG term are the better and cheaper option, and have made all my remortgages over the last 8 years trackers.

mrcow

We have a lifetime tracker and at the moment am happy to keep it this way so the cut today will have an immediate impact.

Perhaps we should have fixed a couple of years back, but I think we missed the boat there and it's no use crying about it now. A 0.25% cut isn't going to make a massive difference, but I guess it all helps a little.