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CAn interest rates be reduced on variable secured loan?

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I have a loan from Paragon Finance for a house extension I had built a few years ago. The loan is secured on the house and has another 3 years of the 10 year term to run. The interest rate is variable and but is not directly linked to the Bank of Engalnd's rate.


In the first few years, when Bank of England's rate went up, so did the Paragon rate, usually by the same amount a month or so later. Over the last 15 months, whilst the Bank of England has reduced its rate to 0.5%, all Paragon have done is to make ONE reduction of 0.5% and that after several weeks of 'announcements' about reducing rates. The gap between the Bank of England rate and the Paragon rate is now more than three times the difference there was when I took out the loan.


Thankfully, I have always managed to meet the repayments and so have kept a 'clean sheet' with Paragon but I am starting to question the lack of reduction in the interest rate. Does any one know if it possible to challenge a secured lender about the rate of interest on a variable loan? If I move to another lender and repay Paragon early, I have to pay a penalty of six months interest.

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