The mortgage rate in the UK is a variable that should be fixed to the Base Rate that is set by the Bank of England. As the base rate rises so do mortgages and as it drops so should mortgages.
The lenders charge more than the base rate, the margin is their profit - which is fine, that is their business.
However it is most noticeable that when the base rate is increased, the lenders all changes their rates accordingly and they do so very quickly indeed, generally the same day.
However when it comes to a drop they are slower to implement the changes, a drop of a ¼ point - if it isn't passed onto the mortgage customer can increase the lenders margin and profits considerably. They have been known to drag their heels when it comes to passing on discounts.
It is certainly worth checking on which lenders have historically passed on the drops quickly and which have been slower.
