Mortgage lenders have been telling Trinity Financial's brokers that they are waiting for the market to stabilise before they make major changes to their new customer rates.
Lloyds Bank, Halifax, HSBC, Barclays, Santander and The Co-operative have announced they will pass on the base rate reduction to existing mortgage customers, but very few lenders have said what will happen to new borrower rates. HSBC is increasing the cost of its fixed rates by 0.1% and Leeds Building Society is also raising some of its rates.
Mortgage lenders have been telling us for some time their profit margins have been reduced and they are not making enough money from savers. The cost of funding fixed rates has fallen recently but these price reductions have not all filtered through to the wider market.
The Money Policy Committee voted unanimously at a meeting on Tuesday for the Bank of England to introduce a new Term Funding scheme and this will enable the banks and building societies to access funds very close to the 0.25% bank rate.
Aaron Strutt, product director at Trinity Financial, says: "Many of the lenders have been caught by surprise with the timing and size of the base rate cut so they are busy working out what to do."
Call Trinity Financial on 020 7016 0790 to secure a mortgage