Moneyfacts: Mortgage holders not getting full base rate cuts

Date:Wednesday 18th February 2009
Author: Max Freedman

Mortgage borrowers are not getting the full benefits of the cuts in the Bank of England base rate, finance information provider Moneyfacts has found.

According to the organisation, rates have changed by less than one per cent on average since New Year's Day.

Its data shows that since January 1st, the average standard variable rate (SVR) has fallen by just 0.31 per cent.

In the same time, average mortgage rates for two-year fixed and tracker deals have fallen by just 0.49 per cent and 0.58 per cent respectively.

Michelle Slade, Moneyfacts analyst, warned: "Anyone coming to the end of an existing mortgage deal in the coming months without substantial equity in their property will find it very hard to find a competitive new deal."

In January, Moneyfacts warned that borrowers without deposits or equity of at least 25 per cent would not be able to find attractive new mortgages.

At the time, Ms Slade said there was "simply no incentive" to find a new deal.