The Bank of England has today cut the base rate from 4.5% to 4.25%, bringing interest rates down to their lowest level in over two years. This is the second-rate reduction of 2025 and the fourth since the peak of 5.25% last summer.
While this move was widely expected, the announcement still raises questions for homeowners, buyers, and anyone considering a remortgage — especially with further rate cuts possible later this year.
Here’s what you need to know...
How the Rate Cut Affects Your Mortgage?
Most people are on fixed-rate mortgages, so your current monthly payments won’t change immediately.
- The rates available when your current deal ends
- The cost of switching early
- How lenders price future fixed deals
Some lenders have already lowered their fixed rates in anticipation of this change — although not all will pass on the full reduction right away.
Tracker mortgages follow the Bank of England’s base rate, so this cut will directly reduce your monthly payments. For the average tracker deal, this 0.25% reduction equates to a £25–£30 monthly saving — a welcome boost for many households.
If You’re on a Standard Variable Rate (SVR), your lender may choose to pass on the rate cut — but they’re not obligated to. Reductions can be delayed or partial, so if you’re on an SVR, you could be paying more than necessary. It’s a good time to review your deal and potentially secure a better option.
Should You Review Your Mortgage?
If your current deal ends this year — or you’re considering buying or remortgaging — now is a great time to review your options.
Even a small change in rates can:
- Reduce your monthly repayments
- Increase your borrowing capacity
- Improve affordability assessments
Acting early means you can secure today’s rates before any market shifts or delays impact your options.
Whether you’re a first-time buyer, or a homeowner approaching the end of a deal we’re here to help.
Every client’s situation is different, and we’re here to help you make the most informed decision for your needs — not just what’s trending in the market.
Why You Should Act Now
Mortgage rates remain unpredictable. While the BoE has held the base rate for now, lenders are adjusting their own rates based on various factors, including market demand and long-term forecasts. Waiting too long could mean locking into a higher rate than necessary.
A mortgage broker can:
✔️ Assess your options across the entire market – not just what your bank offers
✔️ Secure a deal now and keep checking for better rates before your new mortgage starts
✔️ Help you navigate complex lending criteria and find the best solution for your situation
Frequently Asked Questions (FAQs)
1. Why did the Bank of England reduce rates ?
The Bank of England reduced rates to 4.25% to support the economy amid slowing inflation and growing global uncertainty, particularly around trade.
2. How do I know if I should remortgage now?
If your fixed-rate deal is ending within the next 6 months, it’s worth exploring your options now. A broker can help you secure a new rate and monitor the market for better deals.
3. What happens if I do nothing when my fixed-rate deal ends?
If you don’t arrange a new mortgage, you’ll likely move onto your lender’s Standard Variable Rate (SVR), which is usually much higher than fixed-rate deals and could increase your monthly repayments significantly.
4. How can a mortgage broker help me?
A good broker searches over 70 lenders, not just your current lender’s offerings. They can help you secure a competitive deal and continue to monitor rates for potential improvements before your new deal starts.
5. Are rates expected to go up or down in 2025?
Forecasting interest rates is difficult, but many experts predict that the BoE may consider further cuts later in 2025 if inflation stabilises. However, market conditions and global events can impact this outlook.
Get in Touch
If you’re in Cobham, Meopham, Gravesend, Rochester, or surrounding areas, now is the perfect time to review your mortgage.
At Thameside Mortgages, we specialise in helping homeowners like you secure the right mortgage deal. Whether you’re remortgaging, buying, or just exploring your options, our team is here to guide you every step of the way.
📞 Get in touch today for a free mortgage review – because securing the right deal now could save you thousands in the long run.
👉 Call us or book an appointment online now!
You can call us on 03455 120 125, or complete the form below.
Post from Thameside Mortgages
A mortgage is a loan secured against your home or property. Your home or property may be repossessed if you do not keep up repayments on your mortgage or any other loan secured on it. The Financial Conduct Authority does not regulate most forms of buy to let mortgage.
