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Secured loans holders 'not seeing full rate cuts'

Secured loans holders 'not seeing full rate cuts'

Category: Loans

Updated: 31/10/2008
First Published: 29/10/2008

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Lenders are benefiting from the Bank of England's base rate cut by passing it on to savings customers, but not to holders of secured loans, it has been suggested.

Moneyfacts.co.uk noted that although few lenders have cut standard variable rates for mortgage deals, interest on savings has dropped.

And the price comparison site predicted that the majority of those that have reduced secured loans by less than 0.5 per cent are likely to protect margins by implementing savings reductions in the future.

"Although it is well publicised that the banks and building societies need to do more to improve their current financial positions, consumers will feel bitterly disappointed that they are not feeling the benefits," remarked analyst Michelle Slade.

She added that savers should wait before switching accounts, as further base rate cuts may come next week.

Last week Moneyfacts.co.uk mortgage expert Darren Cook observed that more than three-quarters of lenders had failed to pass on the reduction to secured loans holders.

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