Lloyds TSB mortgage holders 'will get base rate reduction'

Date:Wednesday 4th February 2009
Author: Max Freedman

Variable and tracker mortgage holders with Lloyds TSB and Cheltenham and Gloucester have been promised that any reduction in the Bank of England base rate will be passed on to them.

Should the rate be reduced, the standard variable mortgage rate with the lenders will receive an equivalent cut from March 1st.

Tracker mortgage customers will receive the same benefit and as tracker mortgages have no collar, rates could potentially reach zero.

Marketing director for Cheltenham and Gloucester, Stephen Noakes, stated: "With house prices falling overpayment is a wise decision, as not only will it reduce the term on your loan, but it can also help protect the equity in your home."

Last month, Lloyds TSB reported that thousands of its borrowers want to make overpayments as rates fall.

The lender said that overpayments could clear a mortgage more quickly and that more than 27,000 borrowers had asked to make overpayments since November.