Just eighteen months ago many homeowners in the UK were facing crippling mortgage repayments because of the high base interest rate, and many found that they were unable to keep on top of these repayments fuelling a surge in property repossessions across the UK.

However, since then the base interest rate has plummeted and for the past nine months has stood at its lowest level if the three hundred and fifteen year history of the Bank of England, standing at just 0.5 percent.

As a result of the record low base rate many homeowners have seen their mortgage repayments plummet compared to eighteen months ago and even compared to just twelve months ago. In fact, according to figures that were recently released by the Bank of England around 25 percent of homeowners in the UK are now around £200 a month better off compared to the same period last year as a result of lower mortgage repayments stemming from reduced mortgage interest rates.

The Bank of England started slashing the base rate in the hope of aiding economic recovery, boosting affordability for consumers, and helping the flagging property market to get back on its feet after a particularly difficult period.

Around two thousand homeowners were surveyed as part of the research into mortgage repayments, and around 50 percent of these had seen their mortgage repayments fall by at least £100 a month over the past year and around 25 percent had seen their repayments fall by as much as £200 a month.

Mortgage broker Drew Wotherspoon said that many homeowners would be able to continue benefiting from low interest rates for some time, stating: “The raft of fixed rate reductions being made across the mortgage market this week are undoubtedly going to be a welcome Christmas present for anyone who has been holding out for a fixed rate deal.”

Leave a comment