Recently, the Bank of England cut interest rates from 0.5% to an all-time low of 0.25%, the first time the rate has changed since 2009. Mark Carney, the Governor of the Bank of England, said lenders "have no excuse" not to pass on the rate cut, having also made additional funding available for banks and building societies at very low rates on the condition that savings are passed on to borrowers.
What impact will the rate cut have?
Why has the Bank of England lowered the base rate?
While there are many factors involved in trying to predict how long interest rates will stay at 0.25%, the Bank has also indicated that it may soon cut rates again, to "close to zero". This will incentivise banks to lend and should mean mortgages stay highly affordable for the foreseeable future. However it seems very unlikely that the Base Rate will enter negative territory, as has happened recently in some European countries and Japan.