75% of UK mortgage lenders delayed passing on 0.5% rate cut

Posted under General by Jermaine

According to information released by the financial information provider, Moneyfacts, 75% mortgage lenders have yet to pass on 0.5% rate cut in interest to the borrowers even after a month.

It was reported last week that further cuts in rates would be coming soon after admission from Prime Minister and Bank of England’s Governor that the UK was heading for a recession.

However, Darren Cook of Moneyfacts believes that there would be no impact of further rate cuts on the outgoings of a majority of households and it would ultimately lead to an increase in repossessions.

According to the data, less than 50% of 96 lenders have passed on rate cuts to homeowners, with the exception of some including Northern Bank and Halifax which reduced SVR for new borrowers by 0.5%

The spokesperson of consumer organisation Which? alleged that banks were having their cake and eating it too and urged Government to ask lenders to lower rates.

HSBC cut its rates after 8 days by 0.49% and has not yet reduced variable mortgage payments.

Skipton Building Society is keeping their SVR unchanged, although it reduced interest rates on savings accounts by 0.5%.

Other lenders including the Manchester Building Society, Ipswich Building Society, the Mansfield Building Society and West Bromwich Building Society would be adopting same method followed by Skipton.

Ray Boulger, broker at Charcol, believes things should change next month and advises consumers to wait for a few days before shopping around.

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