The Daily Observer London Desk: Reporter- Kathryn Williams
Since December 2021, the Bank of England has slowly been increasing its base rate of interest in a bid to tackle record levels of inflation.
Just over two years ago the rate sat at 0.1 per cent, but it is now at 4 per cent- the highest it has been in 14 years.
Banks have generally responded to these base rate rises by increasing both savings and mortgage rates. However, the mini-Budget last September threw this off track as the economic turmoil it caused initially pushed up the average mortgage rate far in excess of the base rate.
Since then, mortgage rates have fallen – and even after the last base rate increase in December, the average continued to go down.
This week, Virgin Money launched the first fixed mortgage with a rate below 4 per cent that has been seen for months – although the 3.99 per cent deal is on a ten-year fix and only available to those with a deposit of at least 25 per cent.
