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Rise in loan rates by BOE

30/05/08

With the recent rise in interest rates by the Bank of England has resulted in mortgage lenders following suit with a hike in mortgage borrowing rates.  The hike has cleared any hope of a base rate drop.  In addition and importantly a Libor increase is also in effect.  A point 0.08 increase has taken the rate to 5.84.

The ongoing increases in rates for borrowings like mortgages and loans seems to be climbing on a constant basis with no indications that it is likely to slow pace or even take a positive turn.  Some consolation seems to be evident through the lenders benchmarking tool sterling Libor which has shown recent signs of improvement.

According to recent statistics for interest rate increases a recent study claimed that the average two year loan rate is at an almighty high since the year 2000 at 6.64 percent.  In addition, many lenders have still not followed by cutting their rates on borrowings for standard variable rates.