Rate hold cost UK mortgage holders millions each month
(11 January 2008)

The Bank of England rate hold will cost mortgage holders £105 million a month, according to one expert.

John Charcoal claims that the Bank's decision to maintain a 5.5 per cent base rate will cost UK home owners with a variable rate mortgage.

Ray Boulger, of the independent mortgage advisors, said: "The fact that the MPC were unanimous in their decision to cut Bank Rate 0.25 per cent last month, after seriously considering a 0.5 per cent cut, was a strong early indicator that another cut this month was on the cards.

"Add to that various negative economic statistics over the last month plus an increasingly worrying economic outlook later in the year and it is easy to see why a 0.25 per cent cut today would have been justified."

Mr Boulger continued to state that maintaining the current rate would be good news for borrowers with a fixed rate loan.

A recent poll of major financial institutions showed that many believe that the interest rate will be altered twice in the upcoming year, with the first change taking place in February.