So, base rates are now down to 1.0%, and the Zero Interest Bug is not just conjecture.
From The Times:
“About 1,500 customers who took out a tracker mortgages pegged at 1.01 points below the base rate with Cheltenham & Gloucester (C&G), owned by Lloyds Banking Group, will be paying no interest at all on their home loans from next month.
It is the first time that a mortgage lender has been forced to reduce the interest on their home loans to zero.
Lloyds Banking Group, now 43 per cent owned by the taxpayer and also the owner of C&G, said that there was a zero floor to the deal and that because its computer systems could not cope with zero, it would be temporarily charging 0.001 per cent, or 8p a month for a borrower with a £100,000 mortgage. However, that money will be refunded.”
I bet those jammy 1,500 people are feeling quite smug today. Needless to say, I’m still kicking myself very hard for fixing my mortgage last summer… sob!