Although UK Base Rate remained level at 0.5%, the forward curve, used to price such instruments, fell (i.e., became less convex upwards).
For domestic mortgages, the lender often provides guarantees such that the break cost of a loan (in excess of the reported capital outstanding) is limited, often to a number of months repayments.
These guarantees, usually only applicable where the fixed term is relatively short, are effectively a derivative instrument whose one-way benefit is granted to the borrower.
Some fixed interest loans - particularly mortgages intended for the use of people with previous adverse credit - have an 'extended overhang', that is to say that once the initial fixed rate period is over, the person taking out the loan is tied into it for a further extended period at a higher interest rate before they are able to redeem it.
In the UK, Nationwide Commercial recently issued a 30-year fixed rate mortgage as bridging finance.