Lloyds TSB have promised to pass on the full base rate cut to their variable rate and tracker mortgage holders. With the Bank of England reducing the base rate by 0.5% today, will Lloyds TSB keep it’s promise?
Lloyds TSB and Cheltenham and Gloucester mortgage customers must be feeling happy today, as long as they are also not big savers. When Lloyds passes on the full 0.5% interest rate cut, someone with a £150,000 repayment mortgage will now be £38 per month better off from 1st April.
Borrowers on tracker rate mortgages have seen the interest payable reduced by around 90% during the last six months. Lloyds TSB and C&G don’t enforce collars on their tracker rates so there may be a further reduction, if the BoE dares to take the base rate down to near zero, which we doubt.
If Lloyds TSB can pass on the full rate cut to their mortgage customers, then so can the other large lenders, particularly those who have recently received hefty Government bailouts.