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Cutting tracker rates could cost Halifax £575m

Halifax’s decision to pass on rate cuts to tracker borrowers will cost the lender up to £575m a year, reveals analysis from says that existing borrowers at most major lenders can now chase the Bank of England base rate down with no limits on how low it can go but for new borrowers with small deposits the best is around 5.19%.

The online mortgage company says Halifax will likely raise rates for new borrowers to make up for passing on last week’s 1% cut to existing tracker borrowers.

Halifax’s average loan is £115,000 which means a 1% cut equates to £1,150 a year for their reported 500,000 customers.

Francis Ghiloni, marketing and business development director at, says: “Interest rates can go up as well as down but for the next year at least it looks like it will be a case of ‘How low can you go?’ for most tracker borrowers.

“The Halifax decision to cave in to pressure is great news – and considering taxpayers have been kind enough to bail them out – you might say it is the least they could do.”

He adds: “Existing borrowers are benefiting but the concern must be that the £575m Halifax is stumping up will be recouped somewhere else. New borrowers will have to pay and that will restrain the much-needed revival in the mortgage market.”


Fiddling while market burns

Chancellor Alistair Darling has so far failed to put out the fire engulfing the mortgage market. The Bank of England has cut rates in the hope of stimulating some sort of recovery but as lenders hoard capital and bemoan the price of funding, the base rate could fall to zero for all the respite it would offer. As for the Financial Services Authority, creative thinking to get us out of this mess is beyond the regulator’s remit.

Charlbury Group expands nationwide field force

Arrears management expert The Charlbury Group is expanding its nationwide team of field agents as market conditions help to bolster business. The group operates a nationwide field force which conducts a variety of tasks for firms across the mortgage market. It says current market conditions are resulting in the need for greater information on properties […]

Europe: banking on a recovery

Neptune video: Europe — banking on a recovery

Arguing that the eurozone crisis is over, watch Rob Burnett, head of European equities at Neptune, discuss the sectors that he’s investing in to harness the recovery. 

In the video, Burnett addresses the following: 

• The primary drivers of the eurozone’s economic recovery
• The turnaround in individual countries’ current accounts
• Sectors best positioned to harness the recovery, without offering undue exposure to risk


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