Rate cuts 'offer partial debt management help'
Rate cuts 'offer partial debt management help'
- Thursday, 2 April 2009Britons are receiving a little help to
manage debt thanks to the base rate cuts, it has been claimed.
However, they could still need to look elsewhere for
debt management help as many lenders have not passed on the full rate cuts to their customers.
Ross Walker, economist for Royal Bank of Scotland Global Banking & Markets, explains that there are reasons why the full base rate reduction cannot be passed on.
"You couldn't reasonably have a mortgage based at a 0.5 per cent interest rate," he argues.
"It wouldn't reflect risk; it wouldn't reflect the real cost of capital."
As a result, he notes that borrowers are not receiving credit as cheaply as the base rate might dictate on the surface.
Consumers who are finding it difficult to
manage debt even in the current low interest rate environment could look to professional advice such as that available from
DebtFixers in order to help address their economic situation.
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