European base rates down to 2.50%
The European Central Bank has cut the ECB base rate by 0.75%. Markets were not expecting such a drop and it reflects the Banks concern over the weakening economic conditions and an expectation that inflation will continue to fall.
The rate reduction is good news for consumers .We will update our site over the next week or so as we hear news of lenders intentions in regard to passing on this reduction.
Anybody on an existing tracker mortgage will see the benefit within the next week or so. Tracker rates are linked directly to the ECB rate in that these mortgages are priced at a specific margin over ECB
Unfortunately some lenders are still charging crazy rates on variable rate mortgages and I would implore anybody reading this article to check exactly what rates they are on and talk to us about the potential savings through switching.
In regard to today's announcement a .75% reduction on a 30 year 250 k mortgage would result in a fall in repayments of around €100 per month.To test the effect of a .75% reduction on your mortgage please visit our switch_and_save. calculator.
ECB's main refinancing rate is now at 2.50%, its lowest in nearly two and a half years.
It is the third cut in barely two months and reflects the realisation that the financial crisis is biting hard into the real economy. Further rate cuts in the short term are also possible . Earlier today the Bank of England cut rates by 1% down to a new base of 2%.