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Thursday, November 06, 2008

UK: Mortgage Lenders Refuse to Pass on Rate Cut as House Prices Plummet

by Calculated Risk on 11/06/2008 02:31:00 PM

Earlier the BofE announced a dramatic rate cut, The Times reports: Bank of England cuts interest rate by 1.5 points to 54-year low

But apparently most lenders are not lowering mortgage rates: Mortgage lenders refuse to pass on base rate cut

Britain's biggest mortgage lenders have ignored calls from the Government to pass on today's cut in interest rates to struggling homeowners.
At midday, the Bank of England announced that the cost of borrowing would fall by 1.5 points to 3 per cent in an effort to shore up the economy and stave off a deep recession. The surprise cut took the base rate to its lowest level in more than half a century.
As house prices plummet in the UK: House prices dive 15% in record drop
British house prices fell by a record 15 per cent in the year to October as the country's deteriorating economy wiped £30,000 off the value of an average UK home.

On a monthly basis, house prices fell by 2.2 per cent between September and October, according to Halifax, Britain's biggest mortgage lender.