Sean Gardner of MoneyExpert.com, said:
"Things have changed dramatically since the base rate was last at 5 per cent. Mortgage applications fees have risen by 55 per cent and fixed mortgage rates are also higher now than they were back in November 2006."
"However this latest rate cut is a chance for lenders to pass on some savings to consumers. We’re not expecting fees and rates to be slashed dramatically, but hopefully we will see some respite and a settling of the mortgage market in particular."
"Cash-strapped consumers have had a rough ride over the past six months and with confidence in the money markets so low it is fair to say that a rate cut should come as welcome relief. "
"However consumers will only really feel that the Bank of England has done them a favour if mortgages become cheaper and they have to rely less on credit and loans. As the base rate continues to drop, hopefully providers will step up to the plate and offer consumers cheaper deals."
MoneyExpert.com research and analysis*
Since interest rates were last at this level (November 2006):
Average fixed mortgage application fees (all terms) have risen by 55% from £532 to £827
The average initial rate payable on fixed rate mortgages (all terms) has risen from 5.48% APR to 6.25% APR
The average AER on current accounts (£1/£10) has risen from 1.35% to 2.02%
The number of credit cards on the market has increased by 10% from 216 to 238.
* MoneyExpert.com mortgage analysis from 08.11.06, 09.04.08
MoneyExpert.com current account analysis from 15.11.06 and 09.04.08
MoneyExpert.com credit card analysis from 13.11.06 and 09.04.08