Bank of England base rate held for third years in a row but ANOTHER lender hikes mortgage costs

March 8th, 2012

FAKE NEWS for the Zionist agenda

Rates may be held at 0.5% for another THREE YEARS
£100bn sitting in savings accounts paying NO interest
Bank of Ireland increase mortgage costs by around £1,500 per year for their 100,000 customers

By
Becky Barrow and Rob Cooper

Last updated at 3:18 PM on 8th March 2012

Interest rates held

The Bank of England today announced that interest rates will again be held at 0.5 per cent – after three years at record low levels.

But there is evidence that the benefits of lower rates to borrowers are slipping away as banks hike their mortgage costs.

The Bank of Ireland revealed yesterday they are hitting customers with higher loan repayments – just days after
Halifax shocked its customers with a sudden rise in one of its most
popular mortgages.

It is feared other lenders may follow suit.

Today the Bank of England’s Monetary Policy Committee said they are maintaining the base rate.

It has been at 0.5 per cent – the lowest level in the Bank’s 318-year history – since March 2009.

Some experts predicted it could be held at the same rock-bottom level for another three years up until the next General Election – causing great pain for savers.

Future interest rates: Published by the Bank of England on 15 February, this shows the market's expectation for the base rate

Future interest rates? This graph, published by the Bank of England, shows how interest rates have been held at their historic low of 0.5% since March 2009. It may be 2015 before they begin to rise. On the right are Bank of England predictions, from Feb 2012 and Nov 2011, about when rates will increase

The Bank also today held its
quantitative easing programme – otherwise known as money-printing – at
£325billion after injecting £50billion into the economy last month.

The combination of low rates and high levels of QE has been particularly painful for savers and those approaching retirement.

Rates held: Bank of England governor Sir Mervyn King has repeatedly expressed his sympathy for savers as rates have been kept at 0.5%

It is thought that more than
£100billion is sitting in accounts which pay no interest, according to
Bank figures, compared with around £15bn to £20bn in the years before
the financial crisis.

The
Bank’s Governor, Sir Mervyn King, has repeatedly expressed his sympathy
for savers but has said the stimulus measures are needed to help the
economy.

With the base rate at a historic low,
mortgage repayments for new borrowers have reached their most
affordable levels for 14 years.

However, there are signs that this trend is on the turn.

The Bank of Ireland’s move to hike ratesn yesterday will cost their 100,000 customers around £1,500 a year.

At
present, the Bank of Ireland, which is one of Britain’s top ten
lenders, charges 2.99 per cent on its standard variable rate mortgages.
This will be raised in stages to 4.49 per cent by September.

The
repayments of a typical homeowner with a £150,000 mortgage, currently
£711 a month, will rise to £833, an increase of £122 a month or £1,464 a
year.

Last week,
Halifax revealed plans to increase its standard variable rate from 3.5
per cent to 3.99 per cent in May, affecting 850,000 customers.

Like
the Halifax, the Bank of Ireland blamed the decision on higher funding
costs, which it insists means it must raise its mortgage rates.

The move by the Bank of Ireland comes days after Halifax shocked customers with a sudden rise in one of its most popular mortgages

A spokesman said: ‘The cost of
funding mortgages has increased significantly for UK lenders in recent
years, including Bank of Ireland. For this reason, it is necessary for
Bank of Ireland to increase its standard variable rate.’

The decision does not affect
home-buyers who have a mortgage with the Post Office, even though the
Bank of Ireland is the network’s financial services partner.

The bank’s current rate is much lower than most of its rivals’ standard variable rate deal.

Santander, the Co-op and Northern Rock charge more than four per cent, while other lenders charge more than five per cent.

A Council of Mortgage Lenders
spokesman said: ‘Bank and building societies continue to face
challenging conditions in the markets that typically provide their
funding – savings and wholesale markets.

‘Problems in the eurozone have been
causing significant difficulties in recent months, and funding costs are
higher than they were a year ago.’

Here’s what other readers have said. Why not add your thoughts,
or debate this issue live on our message boards.

The comments below have not been moderated.

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The major banks are essentially owned by the government, yet they do nothing to stop this except empty threats. When the banks do nothing the government cry “its out of our hands”, yet they have more power than anyone to do something about this. Its a disgrace! Interest rates for mortgage repayments should be directly linked to the Bank of England base rate, in the same way interest is PAID OUT on savings! Greedy bankers, they want to have their cake and eat it. If only their were a way of galvanising everyone together to say NO, enough is enough!

– Craig D, Bradford, West Yorkshire, 08/3/2012 15:20

It’s a con, the libor swap rates haven’t gone up anywhere near that amount in a year. Saving rates won’t go up much. Profits will I’m sure, who gets shafted, the Public!

– sukh, ilford, 08/3/2012 15:20

Merv the Swerve is keeping the bank rate low while the lenders are actually going to shove them up. It’s a sick joke. Everyone who actually has a mortgage knows the current rate is 5% on average, and make no mistake it will start rising. Thatcherism in its most sinister form is just around the corner but the Government this time will find ways to keep the reported inflation rate down by excluding most items that are rising. This will result in lower pay deals while people get squeezed even more Cynical?

– taff, wales, 08/3/2012 15:03

Oh dear poor savers, I only remember high rates since the 80’s the savers could not give a dam and they moan that since 2008 their savings have dwindled. What about the mortgage payers with high rates. I think the building societies have a cheek to hike rates when people are still being made redundant and the house market is still awful.

– CT, Sheff, 08/3/2012 15:01

Oh, how my heart bleeds….speaking as someone who struggled to pay a mortgage when rates were knocking at 18% and who now receives “Jack” in interest on a little bit of savings….
– honest joe, not sure anymore, 08/3/2012 12:57

Out of curiosity, when you had that 18% mortgage, how much did your house actually cost?

If you had to buy an average priced house today at current interest rates, would your monthly payment be more or less than your previous mortgage?

I think you’ll find that even at 18% interest, your montly payments were a fraction of what the average person is required to pay today.

– Completely Average, Somewhere, 08/3/2012 14:56

AJ Kent. How many of the complaining savers have used their tax-free ISA allowances?
There’s no point in them using their ISA allowances because, unless you’re a high rate taxpayer, the derisory rates on ISAs (even 3 year ISA Bonds) are no better than savers would get in a non-ISA account! And even though people can in theory move money around there’s no real point because all building societies and banks have an informal cartel so that you don’t get significantly better rates even if you move money. Further, if a saver does move money, by the time the bank has delayed through “clearing” the transfer of your funds to a new bank, any tiny increase in interest is obliterated!

– cwjones, london england, 08/3/2012 14:46

Dont insult the DM savers they are thrifty mortgage free loners whose only excitement in life is to see intrest rates rise. They get out there calculators and work out they will earn another £14.22 a year on there savings Ohh what joy and happiness for them.
– Danny, Liverpool, 7/3/2012 22:15 ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ At least they can spell ‘their’.

– Andy, Cheam, 08/3/2012 14:32

I looked about, and none helper was; I sought, and none was that helped; and mine arm saved to me, and mine indignation, that helped me. (I looked about, but no one would help me; I sought everywhere, but no one would help; so my own arm saved me, and my anger, that upheld me.) And I defouled peoples in my strong vengeance; and I made them drunken in mine indignation, and I drew down their strength into the earth. (And I defiled the nations in my strong vengeance; and I made them drunk in my indignation, and I poured out their blood onto the ground.)
– Michael, Anatolia, 7/3/2012 21:13 I completely agree!.. lol!

– Jessica, The Beautiful South, 08/3/2012 14:21

“About time the feckless borrowers paid up. Now is the time for the banks to pay proper interest to the savers who have been mugged by successive governments…”
– Rusty, The Hundred Acre Wood, 8/3/2012 12:44

Guess what Rusty, people who have had money for generations keep spending money in cash and the rest has to work, so is invested. If you’ve been keeping long-term money in cash for a period of time that can be measured in successive governments, then you’re keeping long-term money in a short-term place, no wonder it’s not doing very well.

Interest rates almost never keep up with inflation. Instead of moaning about your bank interest rate, why no go and see a financial adviser or somebody of that ilk, who can help you look after your money properly.

– ZedsDeadBed, Truro, UK, 08/3/2012 14:08

Nationalise the banks like the old CCCP and all banana republics do…..see how that works out for ya!

– biff, barstow, 08/3/2012 13:59

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