There had been hope of a cut by the Bank of England’s Monetary Policy Committee (MPC) to the standard base interest rate by early spring. As inflation held on, optimism declined and the forecast was for one possibly in June. However, now it is more likely to be in August according to experts. Lenders had been cutting their own offerings, but as the expectation for a June reduction of the base rate has been replaced with one later, lenders have begun to raise their rates.

The June rate cut by the MPC may seem less likely, but it isn’t completely an impossibility. There will have been two inflation reports before the next MPC vote. The one released in May and the one scheduled for 19 June. The following day the committee will vote on the base rate.

Last month, two members voted for the rate to be cut. Majority vote will determine if it remains steady at 5.25% or a cut is made and if so, it will likely be small and bring the rate to 5.0% with a 0.25% reduction.

So, why has the outlook on when the rate will be cut changed? The May inflation report brought less than the expected decline to 2.1%, which is near the target rate of 2.0%. It dropped from 3.2% to 2.3%, but the next report could reveal inflation has dropped to or below target. Still, the MPC may allow the rate to remain steady. There are more factors to consider for the MPC in determining if it is time to cut the rate or allow the current rate to bring inflation further under control.

If the June meeting ends with the rate steady, the next meeting of the MPC will be in August as there is not one scheduled for July. Experts are forecasting the August meeting rather than the June meeting will be the first base rate cut since March 2020.

There is, however, no guarantee it will be in August, it might still not be the right time. There was little chance of a rate cut last year, but one could happen in 2024 and maybe more than one cut might be needed. It just might not happen yet and that is why home buyers and homeowners are being encouraged to take notice of the rates available now rather than wait for when the MPC does reduce the base rate.

This is why those looking to borrow or needing to, which is the case of homeowners seeking a remortgage, waiting out for a rate cut might not be the best option. There are lower rates available now compared to last year, and while some lenders are raising their rate offers, others have not yet begun to do so. There are lower than expected rates to be found.

Home buyers are likely to find very attractive deals along with buyer schemes to help them onto the property ladder, though it is more difficult to do so than ever before as housing prices remain elevated from the buying frenzy during the pandemic.

Homeowners already transitioned to their lenders standard variable rate (SVR) because they did not choose to remortgage could benefit from shopping for a remortgage. A SVR could be double or more the rate found with a remortgage deal making it extremely more expensive for than a remortgage. Those homeowners coming to the end of their mortgage term and trying to choose between remortgaging and getting on a SVR should shop for a remortgage and determine how much of a savings exists. Knowing how much money could be unnecessarily spent being on a SVR could motivate to choose a remortgage.

Currently, homeowners are so confident in the available remortgage deals that the five-year fixed rate remortgage is more popular than the usual two-year fixed rate deal. Of course, it could be the lower interest rates found from lenders on five-year deals.

Shopping online for a remortgage is fast and easy and will quickly offer up quotes for homeowners to compare and review. Remortgage brokers might offer exclusive deals and as a one stop shopping experience could offer numerous quotes from a variety of lenders in minutes. Homeowners could also shop from lender website to lender website to gather quotes.

The time to cut the base rate might be this month, or late summer or even early autumn, but what matters most is when the best borrowing opportunities are available that could offer savings and peace of mind. Due to some lenders anticipating the MPC voting to cut the rate, some have already lowered their offers to reflect a lower base rate. Others have become less confident in a sooner rather than later cut and have increased their rates. This is why shopping now could offer the best deal available and rather than miss out, homeowners have simply to spend a few minutes gathering remortgage quotes to build their savings strategy.