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Birmingham Midshire Are 2 Months Behind Passing On Interest Rate Cuts

Written by The Landlord on 19 Nov 2008

hurry up

The other day I was pleading to my readers, asking the question, Are Birmingham Midshire Cutting Their Rates? This question was instigated after the massive 1.5% baserate cut was announced by the Bank of England earlier this month.

Thanks to a reader I was informed that they actually were going to pass on the entire 1.5% cut. That was great news for me and all those on variable rate mortgage plans. I also mentioned two other things. Firstly, that Birmingham Midshire never passed on the previous base rate cut of 0.5% from back in October 2008, and that they take forever and a day to pass on the new rates.

Well, today I got a letter from Birmingham Midshire. I was actually excited when I saw the letter, and quickly ripped apart the envelope. I was eager to see my new beautiful rate. Unfortunately, the slash wasn’t as significant as I had hoped, and it certainly didn’t look like a 1.5% cut. Then I read the fine print (I skipped straight to my new monthly payment initially)- the letter was actually informing me about the 0.5% base rate cut from back in October. What does that mean? Bimringham Midshire have a 2 month delay in passing on their new rates.

I suspect that the 1.5% won’t get passed on until January. That’s a bit fucking long, innit? Anyways, I’m not THAT pissed off because it actually works out quite well, because ultimately I’ll get a bigger rate cut than expected. However, I imagine it’s a different story for those really struggling out there, and are relying on the nig 1.5% cut to get passed on immediately.

So yeah, that’s the latest on the whole Birmingham Midshire saga. I thought i’d mention it because I’ve been getting quite a bit of search engine traffic based on Birmingham Midshire. Does anyone else have any BM news, or can anyone else relate to what I’ve said?

Also, does anyone know whether taking 2 months to pass on rate cuts is standard practice for most lenders, or am I just dealing with a bunch of piss-takers?

Update- 04/12/2008

BM will pass on a cut 0.25% from the 1% that was announced on the 4th of December, 2008.

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29 Comments - join the conversation...

John Sunderland2008-11-20 08:03:51 thanks for the info on Birmingham Midshires eventually passing on the rate cuts,

I seem to remember that they are far quicker in passing on the increases in rates !! 1

The Landlord2008-11-20 08:28:30 No worries, John.

And you're right, they always seem to be in a rush when it comes to increasing the rates. Odd that, huh? You'd think the process in terms of the administration work would be the same- to increase and decrease. 2

a mck2008-11-24 08:20:41 I just got my letter I was the same thought it was the biggie. But it wasn't it only the 0.5% cut BM need to get a grip and pass on these cuts! I can't believe they are dragging there feet with this . 3

The Landlord2008-11-24 08:30:18 Hey A Mck,

Yeah, they seem to be taking their sweet time, and it's extremely irritating.

I spoke to someone with a Abbey Tracker mortgage yesterday, and they got the letter for the 1.5% cut on Saturday (22/11/08). So it looks like it's very much on a lender to lender basis at which rate they pass the new rates on.

ANNOYING!

Kind regards 4

a mck2008-11-24 09:11:09 I think I may be giving them a call and kick up a
stink! It's a cheek to be 2 months behind what if the rates go back up? Will we not see the price cuts?

I'm so fed up with BM 5

matt2008-11-24 13:25:42 can anyone confirm that this is definitely relating to the oct 2008 0.5% cut, and that they will lower mortgage rates again fore the 1.5% cut... i gave them a call and they couldn't confirm anything 6

The Landlord2008-11-24 13:48:07 It's definitely related to the 0.5% cut, because that's what it said on the letter.

And it is confirmed here that BM will be passing on the 1.5% cut eventually.

Kind regards 7

a mck2008-11-24 14:03:24 I can confirm it got the letter this morning specifically stated Octobers 0.5% cut 8

joe2008-11-24 18:16:18 just got my letter today for the 0.5% had shock thinking it was the 1.5%,looks like we have to waite to jan for that one.
i will be watching with interst when it goes up again to see how long they take to increse it.
joe 24-11-08 9

Kelly2008-11-25 18:14:44 Did nobody read the back of the letter explaining that the rate cut gets passed on one or two months after the BoE rate cut dependng on the date your mortgage goes out. And to be fair, I checked previous statements and the rate rises were delayed by the same amount! 10

The Landlord2008-11-25 19:16:34 Hey Kelly,

I missed the fine print!

"one" or "two" months- that's quite a big difference...I'd prefer one month! 11

Giddearn2008-11-28 10:54:26 As Kelly wrote, I can't complain at them delaying the rate cuts, so long as they do eventually pass them on in full. If you look back at your statements from 06/07, they were also a month or two behind on rate increases as well. The only difference was that there weren't any immense 1.5% rate jumps in one go! 12

Fred2008-12-04 17:47:09 I have recieved a letter relating to the 0.5 cut of 8th October 2008, and guess what? the rate effect will take place on 6th January 2009! Is that not 3 months? 13

Fred2008-12-04 17:49:13 No notification yet of the w.5 cut and todays further 1% cut .....it is unlikely to be seen before MArch or April 14

Simon2008-12-04 19:20:36 Yes exactly the same for me.

I phoned them staight after the 1.5 cut and they confirmed that they will pass it on but they didn't know when.

They then went onto confirm that the previous October cut was going to be passed on at the end of December!

So we know that they will pass it on but they really take the micky about the delay. Will they start getting cute though with todays cut and only pass on part of the 1%.

3% has been taken off the base rate but the bottom line is many BM customers are yet to see any of this at present!! 15

Fred2008-12-04 20:04:11 As it would appear that we are onthe standard vairable rate, i wonder if anyone has looked at the legal position. I will try to dig all the papers and see what the position is. There must surely be some clarity on this issue. BM appears to be taking the micky -on rate rises a letter arrives without delay and advising not very long after of taking higher monthly prenium. 16

The Landlord2008-12-04 20:11:23 From what I'm aware, the lenders don't have to pass on the rates at all to their borrowers if they're on a variable rate.

The only time lenders have to pass on the rate to borrowers is if they're on a tracker. But even some trackers have a minimum rate, which it can't go below, regardless of how low the baserate is. 17

matt2008-12-04 20:27:28 it was confirmed on the bbc news that the halifax group will pass on all of the BoE cuts, and that BM has no minimum % tracker rate!

this is fab news, but we will probably have to wait till easter before they finally have matched the BoE cuts!! 18

Kelly2008-12-05 08:25:30 If your payment drops end of december or start of januari, this means that the interest rate cut has started a month earlier, since you only pay the interest after you have borrowed the money for a month, not in advance. 19

WAFJoke2008-12-05 10:49:48 Another pissed off BM customer.

I have yet to see the 0.5% decrease from way back let alone the next 2 cuts.

I am out of my mortgage agreement and on the standard variable of BOE +1.75%. But takes them 2 months before a cut is passed on. 20

Oaktree2008-12-05 12:54:08 Like so many of you I am livid about the fact that the interest rate cut will be passed on far too late (in my case also about 3 months)by BM. This is a substantial amount. It is no good just to accept this as God given, so we should get more active. Therefore is anyone of you aware of an online petition to have the interest rate cuts refunded? Any feedback would be much appreciated. 21

Steve2008-12-05 13:33:56 Where did you hear the BM is passing on the full 1% is this to people on SVR as well? 22

The Landlord2008-12-05 13:47:07 Hi Steve, from what I'm aware, they're only passing on 0.25% to the people on SVR.

More details here: Which lenders are passing on the 1% interest rate cut 23

Steve2008-12-05 13:51:56 Hi, Yes I thought it would be 0.25% like the Halifax but the update above said BM would pass on the 1% cut announced on 4th December. 24

The Landlord2008-12-09 14:00:35 I got a letter through today about the the big 1.5% cut. It will get passed on the 17th January!

From what i'm aware, BM won't pass on the entire 1% from last week, but they will pass on 0.25%. Probably have to wait until March for that! 25

simon2008-12-13 20:46:39 I received a letter saying the 0.5% cut from October will take affect from Jan (letter sent at end of Nov). Then another letter last week saying 1.5% cut from Feb. While this is good news, on the FAQ section on back it explains that depending on when you make your mortgage payment it would be following month or 2 months from date of rate cut before change. This would mean the change should happen in December (0.5%) and Jan (1.5%). So they are taking the piss! 26

Surrey Boy2009-01-04 20:57:48 Regarding the passing on of just 0.25% of the last 1% cut to BM SVR customers, does anyone know what will happen once the Lloyds merger is completed which I believe should be in the next couple of weeks. As I understand it Lloyds had passed on all of the last 1% rate cut so will HBOS owned companies have their policies and interest rate decisions standardised once under the 'Lloyds Group' umbrella. If so would BM then be made to pass on the differential in the rate cuts between themselves and Lloyds thusfar(i.e the remaining 0.75% of the last cut). Answers anyone please? 27

matthew2009-01-13 17:18:06 had a letter from BM today announcing a cut in interest rates based on 4th december 2008 and bank of England will be reducing the rate from 1 jan by 1% down from 3% to 2%. However BM as always will change the amount taken from your ban in March 2009. The letter doesn't say if what cut they have passed on anywhere in the letter sent to me but it is definately is more than 0.25% as mentioned above. This may however be because I am on a 2 year discounted mortgage deal. Any further info would be greatfully received. 28

Sarah2009-03-13 18:01:39 Hi
I currently have a fixed rate mortage with bm which ends in june then i will go on to the svr, does anyone know what the rate is now for this?? thier website states something like 4.9% still im confused! Going by that it seems like im not going to be much better off anyway unless they just havent updated it. 29