Low base rate good for many people in debt

16 July 2009

The Bank of England`s Monetary Policy Committee (MPC) today announced it was keeping the base rate at the historic low of 0.5%.

The news comes as no surprise, as the MPC is unlikely to increase the base rate until the economic recovery is well underway.

The low base rate is particularly good news for people with tracker/SVR mortgages, as it means the cost of servicing their mortgage debt is unusually low. Tenants and people with fixed-rate mortgages, on the other hand, aren`t benefiting in this way - and most savers are concerned about the low returns they`re seeing on their savings.

A debt management expert at Gregory Pennington said: "People who are left with `extra` money after they have made their monthly mortgage payment should think carefully about what they could do with that money. For example, they could overpay their mortgage debt - or their other debts - or put the money into savings. The right course of action for them will depend on their personal circumstances.

"If they`re unsure about what they could do with their `spare` money, a professional debt adviser could help."

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Gregory Pennington offer debt management plans as well as a range of other debt solutions. If you are worried about debt, contact one of our expert debt advisers now.

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