Experts have advised that the Bank of England will maintain interest rates at historic lows well into next year, offering a further blow to savers but a boost to homeowners . Homeowners have enjoyed a massive reduction in their monthly mortgage repayments as a result of the plummeting interest rates, whilst savings accounts have yielded an increasingly meagre return. Pensioners will be particularly concerned at the news, as returns on their money remain at a worryingly low level. First time buyers are likely to benefit from the news, with lenders potentially coerced into offering the newcomers better deals upon the news.
No discussions were held about increasing the interest rate at this month's meeting of the Bank of England's Monetary Policy Committee. The base rate has been slashed from 5 per cent in October 2008 to a record low of 0.5 per cent. The mortgage market appears to finally be showing signs of benefiting from these cuts, with banks beginning to offer more attractive deals to borrowers unable to provide hefty deposits .
Richard Morea, of mortgage brokers London and Country, said, 'Rather than good rates being offered only for very low 60 per cent deals, what we might see is a bit more innovation and lenders trimming off a bit of the rate at higher loan-to-values.'
Bank of England Forecast to Hold Rates Well into Next Year
Financial Services > e-banking > Banking news
Bank of England Forecast to Hold Rates Well into Next Year
Fri, 22 May 2009
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