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A quarter of lenders failed to pass on base rate cut on SVRs

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With a further base rate cut before the end of the year becoming a possibility, it has emerged that a quarter of lenders have not reflected the reduction applied two months ago.

The base rate was cut to 0.25 per cent on 4 August, but Moneyfacts.co.uk has found that many lenders failed to pass on the cut to their standard variable rate mortgage borrowers.

Moneyfacts.co.uk finance expert Charlotte Nelson says: “Many borrowers on their SVR hoping to benefit from the Bank of England reduction could be sorely disappointed as two months on, a quarter of lenders have still yet to cut their rates to reflect the new circumstances.”

She said the average SVR has fallen by just 0.17 per cent.

“Lenders are facing pressure from the uncertain state of the economy, making them err on the side of caution as they react to the change in base rate,” says Nelson.

However, she said the picture is much brighter when looking at the average lifetime tracker rate, which has fallen by more than the 0.25 per cent cut.

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