Lloyds TSB and Cheltenham & Gloucester (C&G) have pledged to offer borrowers additional debt help if the Bank of England lowers the base rate this week.
The lenders stated that any interest rate cut will be passed on to existing tracker and variable-rate mortgage customers.
If the Bank’s monetary policy committee (MPC) announces a reduction, both companies’ standard variable rate, which is currently at 3.5 per cent, will be lowered by the same level on March 1st.
In addition, the firms noted that their tracker products do not have a restriction on how low rates can fall, meaning that they could potentially drop to zero per cent if the base rate does so.
Stephen Noakes, marketing director for C&G, advised borrowers to take advantage of low rates and make overpayments.
“With house prices falling, overpayment is a wise decision,” he remarked.
Recently, Council of Mortgage Lenders spokesperson Bernard Clarke claimed that overpaying on mortgages can help to reduce debt by a “significant” amount.
By Jamie Price