Bank of England base rate lowered to 4.5% but have the mortgage lenders reacted?

by Aaron Strutt

Feb 07 2025

The Bank of England Monetary Policy Committee has cut interest rates from 4.75% to 4.5% - the lowest base rate since June 2023.

At its meeting ending on 5 February 2025, the MPC voted by a majority of 7–2 to reduce Bank Rate by 0.25 percentage points to 4.5%. Two members actually preferred to reduce Bank Rate by 0.5 percentage points to 4.25%.

The Bank also reduced its growth forecast for the UK economy from 1.5% to 0.75% for this year.

Aaron Strutt, product director at Trinity Financial, says: "The base rate needed to come down because the higher rates are squeezing too many people, ultimately reducing their spending power and our economic growth.

"There needs to be a balance so savers can get a decent return on their money and mortgage rates are more reasonably priced, especially for those with smaller deposits. There is a need for cheaper mortgages with so many first-time buyers keen to get on the property ladder, and a reported 1.8 million homeowners needing to remortgage this year."

What has happened to mortgage rates since the base rate cut?

At the time of writing this blog, there has been no real rate movement from any of the major banks and building societies. 

This base rate cut may well mean we get sub-4% fixed rates again soon, which would be good news for borrowers searching for cheaper mortgages. Lenders should also be able to issue more generous loan sizes, as they can lower the stress test figures used to determine how much applicants can borrow on their affordability calculators. 

Call Trinity Financial on 020 7016 0790 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

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