The recent increase in the Bank of England's Base Rate, from 4.25% to 4.5% in May 2023, has had a significant impact on individuals with finance loans. In this article, we will discuss the implications of this rate rise for dentists and their practices, as well as provide guidance on mitigating the effects and maximising savings.
One of the key implications of the rate increase is that monthly repayments for variable rate loans and overdrafts are likely to rise. This is because the interest paid on outstanding balances is determined by the bank's interest rate plus the Bank of England Base Rate. With the Base Rate increase, those with variable rate loans and credit cards will experience higher monthly payments. However, if you have a fixed-rate loan, your repayments will not be affected in the same manner as those with variable-rate products.