Lenders welcome rate cut
Large mortgage lenders are to pass on the Bank of England's interest rate reduction.Yesterday, the central bank announced that it was lowering the base rate by 0.5 per cent, with the European Central Bank and US Federal Reserve doing the same.This was a concerted action aimed at tackling the worst effects of the credit crunch, which has worsened over the last few days and threatens to push down house prices and limit loans availability still further.Lloyds TSB and Halifax are among the lenders passing on the 0.5 per cent cut on their standard variable rates (SVR).Earlier yesterday, chancellor of the exchequer Alistair Darling announced that the government would be buying up around £50 billion of shares in banks.It is hoped by ministers that this will lessen insolvency risks and encourage inter-bank lending.Michael Coogan, director general of the Council of Mortgage Lenders, commented:"The package of bank funding and capital measures is further strengthened by this rate cut."All this decisive action augurs well for an improving market situation looking ahead, even though no-one is pretending the tough times are over yet."
Share this..
Related stories
Results week beckons for UK banks
This week sees a range of UK banks announcing their profits at a time when it is very difficult to know what to do. As a UK bank, do you announce exceptional profits and thank the taxpayer for helping out or do you play down the situation and promise to increase lending in the future?
In many ways the UK banks cannot win this week because if they show signs of recovery in their prof...
Begbies Traynor Sees Insolvencies On The Up
While the corporate insolvency experts Begbies Traynor may have reported a fall in 2007/2008 profits to £5.7 million it seems that the worse the economy gets in the UK, the better the environment for their services. Even though the fall from a £8.5 million profit last year to £5.7 million this year was disappointing, the company did comment that this had been one of the quietest periods in the...
Read MoreUK house building slumps to lowest level since 1953
The number of new homes being built in the UK slumped to its lowest level since 1953 according to statistics released today. There were just over 18,000 housing starts in the first three months of 2009 and while it was up 13% on the previous quarter it was down a massive 44% on the same period one year ago. However it is the near 50% reduction over the last 12 months which has caught the eye of ma...
Read MoreWhy credit card debt is so dangerous
As we covered in one of our earlier articles, there has been a massive increase in the number of people using their credit cards to cover mortgage payments and monthly rent charges. This, despite the fact that credit card debt is by far and away the most expensive type of debt available to the UK consumer, is a worrying development. When you consider that the vast majority of credit card interest...
Read MoreWhy are UK lenders not passing on cheaper finance costs?
There is a growing debate as to why UK lenders (particularly mortgage lenders) seem reluctant to pass on any significant reductions in their finance costs to the UK consumer. As everybody now knows this was a vital part of the government's bailout plan with assurance sought from each and every bank in the UK looking for additional funding but for whatever reason this has not yet materialised.
Read More