Bank of England Base Rate FAQs

Today, Thursday 2 November, the Bank of England announced a 0.25% increase in the base interest rate. This means your client's mortgage rate and subsequent monthly payments may be affected, depending on the type of mortgage they have. Please see our FAQs below for more information.



My client is currently completing their new mortgage, will the announcement affect them?

If your client has chosen a tracker mortgage, their rate may change as a result. We’ll write to them to confirm their new rate before their first payment.

My client is on a fixed rate but their product is coming to an end this month, will they receive a letter?

Yes – we’ll write to them to confirm their new monthly payment five working days before the end of the month.

My client is on a Managed Rate, why isn’t their payment increasing?

As TMW's Managed Rates aren't linked to the Bank of England base rate, we’ve made the decision not to increase them at this time. TMW's Managed Rates continue to be competitively priced compared to the variable rates in the market and offer a high level of flexibility. In most cases, your clients also have the option to switch to a new mortgage deal.

My client is on a Managed Rate, are they eligible to switch to a new deal?

If your client is a TMW customer, please log into TMW Online to check if they are eligible for a new product or alternatively you can refer them to www.tmwdirect.co.uk/oms .

Unfortunately we do not currently offer switcher products for DHLL and EMEX customers.

How does the base rate change impact customers applying for new trackers? (TMW only)

All mortgage tracker KFI and offer documents will reflect the new Bank of England base rate from Friday 3 November.

For new customers completing on trackers from this date, the new base rate will be reflected upon completion.

How will you work out my client's new monthly payment amount?

We’ll use your client’s outstanding balance, along with their new interest rate to calculate their new monthly payment. The total amount they owe will be distributed over the months remaining until their mortgage end date.

My client’s rate has changed, what does this mean their payments will be?

To help you see what the Bank of England base rate change means for your client’s interest only mortgage, we’ve created an example table below based on an increase of 0.25%.

Mortgage balance Interest only monthly increase Interest only annual increase
£50,000
£10
£120
£75,000
£16
£192
£100,000
£21
£252
£125,000
£26
£312
£150,000
£31
£372
£175,000
£36
£432
£200,000
£42
£504
£225,000
£47
£564
£250,000
£52
£624

Figures based on an interest only mortgage

My client's payment has changed, but can they continue to make overpayments?

Yes, if they’ve extra money available, it could be worthwhile paying as much as they can afford each month.

If they have a mortgage where an Early Repayment Charge applies, this will also apply if they make an overpayment of more than the overpayment allowance. So please refer them to their annual mortgage statement or their original mortgage offer to check their limit.

My client's been making regular overpayments, why hasn’t the term of their mortgage changed?

Unless they specifically ask for their term to be changed, we’ll continue to calculate payments to repay the mortgage over the agreed term. Any overpayment they've made has reduced the balance of the mortgage and this has reduced the interest they're paying.

Why haven’t the rates on all my client's mortgage accounts changed?

If your client has more than one account, their rate on other accounts may not change because they may have a fixed rate on their account, which won’t change until the end of their product term or they are on one of our Managed Rates.

Will my client's monthly mortgage payment automatically change to the new amount?

If they are currently paying by Direct Debit then this will automatically be changed and they don't need to do anything. However, if they are paying by any other method, including Standing Order, they will need to change the amount they pay with their bank so that it covers the new monthly commitment.