Mortgage Tracker based on BoS base Rate

[Peter Loew]

Does anyone know how the BoS base rates move in relation to BoE base rates?

Just had a tracker mortgage offer but based on BoS base rates which rings alarm bells in my head.

Cheers,

P

[BrilloPad]

http://www.bankofscotland-internatio...t-mortgage.asp

It is very rare for any bank base rate to be different to bank of england base rate for more than a few hours. In fact I have never heard of a case.

[Bumfluff]

I read that some of the banks have not passed BOE rate cuts down to the banks own variable rate, a few banks have done it recently I think.

Worth trying First Direct there doing very good deals at moment, they wont deal with mortgage brokers so I had to go direct but they seem contractor friendly.

[AtW]

It is very rare for any bank base rate to be different to bank of england base rate for more than a few hours.

That's a very big assumption.

[Peter Loew]

This is all very interesting.

But I would imagine given the economic climate that most banks would want to make more profit in the coming couple of years, so their rate seems easier to manipulate that the BoE rate.

BTW BrilloPad not going for a BTL mortgage.

P

[BrilloPad]

That's a very big assumption.

Have you ever seen a case otherwise?

[Moscow Mule]

Does anyone know how the BoS base rates move in relation to BoE base rates?

IIRC they are directly tied to the BoE.

As yet there is no provision for the devolved government (or other mechanism) to set it's own interest rates separate from the BoE.

[BrilloPad]

IIRC they are directly tied to the BoE.

As yet there is no provision for the devolved government (or other mechanism) to set it's own interest rates separate from the BoE.

MM - are you implying that BoS is in someway tied to the Scottish parliament? BoS is a bank rather like Barclays, NatWest etcetc.

However I agree - rates will track the BoE rates - I am trying to find a case where it has differed for more than a few hours.

[BrilloPad]

MM - are you implying that BoS is in someway tied to the Scottish parliament? BoS is a bank rather like Barclays, NatWest etcetc.

However I agree - rates will track the BoE rates - I am trying to find a case where it has differed for more than a few hours.

http://www1.icaew.co.uk/library/inde...AUB=TB2I_25315

"The base rate is the rate at which the Bank of England lends to other financial institutions and is set by the Monetary Policy Committee in response to economic conditions. The retail banks usually follow this lead, although they have the freedom not to."

Though I just had a look at this :-

http://www.bankofengland.co.uk/mfsd/...=41&G0Xtop.y=8

It compares BoE rate against average of 4 largest retail banks.

Last time there was a difference was 2000 - since May 1997 there have only been 5 days when different.

[Moscow Mule]

MM - are you implying that BoS is in someway tied to the Scottish parliament? BoS is a bank rather like Barclays, NatWest etcetc.

No, that mechanism doesn't exist yet. If the Scottish Nationalists get their way then the BoS is the most likely bank to be nationalised as their "central bank" since they already have the right to print their own money and the mechanisms to do so. It's only then that they would be able to separate from the BoE and decide their own rates (if the scots parliament allows them to).

You're right that BoS have to abide by the same rules as everybody else.