The Bank of England has cut interest rates from 4.75% to 4.5%, marking the lowest level in over 18 months. This move could reduce borrowing costs but also lower returns on savings.
Borrowers who currently face higher monthly payments due to rising interest rates will see some relief. However, those with mortgage terms ending soon may struggle to take advantage of the rate cut before their existing deal expires.
One couple, Becky and Jon Ball, fear missing out on better deals if they don’t act fast. They expect a £125 increase in their monthly mortgage payments but hope the rate cut will lead to lower rates for them before April.
Craig Mountaine, a 55-year-old semi-retiree, is less optimistic about the impact on his savings. He expects to lose around £40 per month from reduced interest earnings.
Meanwhile, Gino Rocco and Subbu have expressed concerns about rising mortgage costs and struggling with increased expenses due to higher interest rates. For Subbu, a 23% interest rate on his credit card is particularly concerning, and he’s considering releasing equity from the house to pay off his debt.
Source: https://www.bbc.com/news/articles/cdjdmvplm8vo