Borrowers ‘benefiting from rate falls’ this year

Borrowers hoping to avoid the need for debt help could be set to benefit, as an expert has observed that interest rates are coming down.

Darren Cook, spokesperson for Moneyfacts.co.uk, noted that the first six weeks of the year have seen the costs of mortgages decline.

However, this is coming at the expense of savers, with Mr Cook stating that lenders are only able to compete by lowering the rates offered in this area.

“As long as the cost to borrowers keeps reducing, I don’t see it getting much better for savers in the short term,” he said.

The price comparison site representative went on to suggest that the situation is unlikely to change significantly until the Bank of England restores its base rate to a “healthier position” of three to four per cent.

He was commenting after moneysupermarket.com suggested that rising inflation has contributed to the damage done to savings this year.

By Andy Mackay