On Wednesday 11th March 2020, the UK Bank of England announced that they have reduced interest rates by 0.50%, to 0.25% as a response to the wake of the Coronavirus.
We have already received an unprecedented amount of enquiries from new and existing clients asking what this may mean for them.
What effect will this have?
Bank of England Governor, Mark Carney stated in a press conference that “activity is likely to weaken materially in the coming months” and “the reduction in the bank rate will help bolster confidence at this difficult time”.
We believe that this swift decision was one of foresight from the Bank of England and one that we welcome.
“The markets have taken a severe knock in recent days and it sends a clear message of support to the UK economy, especially to the smaller businesses that will be most affected by the Coronavirus fears.”
Andrew Sheen, Managing Director
We believe that this measure has been taken to ensure that the banks continue to lending in an environment where spending is likely to reduce in the coming months.
What Does This Mean For Mortgages?
We are unsure if this is going to have an immediate impact on the cost of mortgages, especially when they are already extremely low. There certainly hasn’t been a sudden shift in the mortgage market in terms of fixed rates. This decision from the Bank of England was in clear support of UK businesses and aimed at ensuring the banks continue lending, as they want to avoid an increase in the costs of borrowing, rather than to facilitate a reduction, but only time will tell.
We will certainly be keeping a keen eye on what the banks will be doing, but we welcome this announcement by the Bank of England to help our UK economy remain as strong as possible during this period of time.
Get In Touch – Live Chat
We have already been speaking with our own customers about this, but we have also spoken with new clients who would like to revisit their finances and compare their current mortgage rates to the already extremely low rates on offer from the 90+ mortgage lenders we have access to.
We have a Live Chat facility on our website that can help answer your questions.
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