Andrew Montlake: Rate cut shows “carnage that COVID-19 is wreaking”
The rate cut by the Bank of England is symbolic and also shows “the absolute carnage that COVID-19 is wreaking across the UK and global economy”, according to Andrew Montlake, managing director of Coreco.
Interest rates are now at their lowest level in history, Montlake suspects as a result there will be a surge in enquiries about what this means from existing and prospective mortgage borrowers.
As a result of the cut, those on a tracker product will see an immediate benefit, but Montlake believes that fixed rates are unlikely to be cut much further.
He added that this is due to lenders having their own issues at the moment with a large number of their staff off or working from home.
Montlake highlights that some lenders, especially more specialist mortgage providers, have increased their rates to protect their positions.
He said: “In the current climate, lenders need to preserve their margins more than ever, if not bolster them further.
“For the Bank of England to cut rates right to the bone highlights the extraordinary times we are living in.
“For anyone looking at remortgaging within the next six months, now is categorically the time to get on with it.”