BANK OF ENGLAND BASE RATE CHANGE

On 11th March 2020, the Monetary Policy Committee (MPC) voted to decrease the Bank of England (BoE) Base Rate from 0.75% to 0.25%, this was further reduced on 19th March to 0.10%

What does this mean for me?

We will be reducing the rates for those customers on bank base rate tracker products and we are also reducing our standard variable rate (SVR) to 4.49%.

We are continuing to review how these changes will impact our variable rate mortgages.

The questions and answers below are designed to give you the latest information available.

If you want to contact us immediately, please call us on 0345 300 2522. Please note that during rate change periods, our lines can become very busy.

 

Mortgage Specific FAQ’s

I have a tracker product when will my interest rate change?

If you're an existing customer with a base rate tracker product, your interest rate may decrease on 3rd April. Whether your interest rate decreases depends on whether you have already reached the minimum interest rate (also known as a floor or collar) on your product. Don’t worry, we will write to you if you are affected.

I am currently on the standard variable rate (SVR) when will my interest rate change?
If you're an existing customer on our standard variable rate, your interest rate will decrease on 20th April.

I have a SVR discount product when will my interest rate change?
If you're an existing customer with a SVR discount product, your interest rate may decrease on 20th April. Whether your interest rate decreases depends on whether you have already reached the minimum interest rate (also known as a floor or collar) on your product. Don’t worry, we will write to you if you are affected.

When will my mortgage payment change?
If you have a fixed rate mortgage with us, your payment won’t change during the fixed rate period.

If you have a variable rate mortgage, tracker or other mortgage that does not have a fixed rate, any change in payment won’t take effect until your account is reviewed at the end of the year. Any change to your monthly payment will then be applied in March 2021. This means that you will be charged the lower interest rate but your current monthly payment won’t change until March 2021. We will tell you about your new monthly payment in your mortgage statement.

If this affects you and you want to change your payment before March 2021, you can request this by calling our contact centre on 0345 300 2522 and speak to one of our agents who will be able to arrange your payment to be updated. Calling our Customer Contact Centre on the General Enquiries number and speaking to one of our agents who will be able to arrange your payment to be updated.

For more information on the annual account review process, please refer to your ‘How Your Mortgage Works’ booklet, which was included with your mortgage offer.

 

 

 

 

General FAQ’s

What is the Bank of England (BoE) Base Rate?
The BoE Base Rate is the rate of interest that the Bank of England charges banks and building societies when they borrow money. As a result it underpins the way that financial institutions obtain funding to provide mortgage and savings products. Any change to Base Rate, may impact the interest rates on those products.

 

What is a Bank of England Rate change?
This is when the Bank of England’s Monetary Policy Committee (MPC) determines that – in the best interest of the overall economy - that the Bank of England’s Base Rate needs to be adjusted from its current rate (this can either be an increase or a decrease).

 

What was the last Bank of England Rate change?
The last time the Bank of England changed Base Rate was 2 August 2018 when it increased from 0.50% to 0.75%

 

What happens if the Bank of England Base Rate changes again in the future?
We would need to review the impact of any further Bank Rate changes in the context of the market and other economic factors at any such time.

 

When could the Base Rate change again in the future?
The Base Rate will change when the when the Monetary Policy Committee determines that the UK economy needs to adjust to remain stable and sustainable.

The Bank of England’s Monetary Policy Committee regularly reviews the Base Rate (normally on a monthly basis) to determine whether a change is required.