Base rate change and mortgages

It’s the rate the Bank of England charges other banks and other lenders when they borrow money, and it’s currently 5.25%. The base rate influences the interest rates that many lenders charge for mortgages, loans and other types of credit they offer people. For example, our rates often rise and fall in line with the base rate, but this isn’t guaranteed. You can visit the Bank of England website to find out how it decides the base rate.

The Bank of England can change the base rate as a means of influencing the UK economy. Lower rates encourage people to spend more, but this can lead to inflation – an increase to living costs as goods become more expensive. Higher rates can have the opposite effect. The Bank of England reviews the base rate 8 times a year. 

Fixed-rate mortgage

The change won’t affect your payments immediately, but probably will when your fixed period ends and your mortgage moves to the variable rate shown in your mortgage documents.

Remember that we could offer you a new deal with exclusive rates we reserve just for our customers. You can arrange to switch to a new rate up to 180 days before your fixed-rate period ends.

Tracker mortgage

It’s likely the interest rate you pay will move in line with the base rate change. You’ve got the option of continuing with your current deal or changing to another tracker, fixed or offset mortgage with us.

Offset mortgage

Our offset mortgages track the base rate so it’s likely your payments will change. But you’re also using your savings to reduce the mortgage balance we charge interest on, so the more you offset the less impact a change to the base rate would have on you.

Standard variable rate

We'll write to you if your payments are going to change. Remember that our standard variable rate can change at any time, including when the base rate changes.

Buy-to-let mortgage

Your buy-to-let mortgage could be a tracker or a fixed rate, so check your documents and then follow the information we’ve provided above.