Tracker Mortgages

Tracker mortgages (also known as base rate tracker mortgages) give you all the benefits and assurances of banking with the Bank of England! Tracker mortgages vary in line with the Bank of England interest rates; that means they reflect the strength of the economy better than any other mortgage can or does. But there’s a lot more to them than that…

A tracker mortgage isn’t just a variable rate mortgage; it’s a variable rate mortgage with assurances. For instance, tracker mortgages are designed to give you all the benefits of favourable adjustments in the Bank of England interest rates – instantly. There’s no more waiting for the benefits to filter through to you; when the rates fall, so will your mortgage payments. Better still, the differential between interest rate and mortgage rates remains constant. That means no unexpected discrepancies when the base rate falls; it means that the full benefits of a healthy economy are passed on to you. Best of all, if you like it, then stick with it. Base rate tracker mortgages are available for the full term of your mortgage; so if interest rates are favourable, the base rate tracker scheme will give you very favourable reductions in your monthly re-payments throughout the life of your mortgage.

Another benefit of the base rate tracker is that, assuming you keep an eye on the interest rates, you’ll know exactly what you’re going to get month to month. One of the perceived disadvantages of a variable mortgage is the uncertainty that borrowers face. It doesn’t have to be like that at all. The Bank of England interest rates are easy to follow. You can get the latest rates from brokers and lenders; in banks and building societies. They’re reported on television, radio and in the papers. You can even find the latest rates reported, tabulated and discussed online, together with records detailing Bank of England rates as far back as the early nineties. All of which makes it very easy for you to keep track on your tracker mortgage rates.

Your choice of mortgage will of course depend wholly on your circumstances. Fortunately tracker mortgages are available in just as many permutations as any other scheme, giving you all the choice of fixed, discounted, tied-in and flexible packages to fit your needs. Many mortgage providers offer tracker mortgages at initially discounted rates. Stepped discounted trackers let you take advantage of a scheme that tracks at as much as a whole half percent below the base rate for an agreed period. Thereafter it reverts to an ongoing rate a little bit above the base rate. You will of course continue to enjoy all the normal advantages of reductions in the interest rates whether it tracks above or below the base rate.

There are of course no assurances that interest rates will remain low throughout the duration of your mortgage. As lenders are compelled to tell you, rates can go up as well as down. But bear in mind that the Bank of England is committed to keeping interest rates low. Low inflation is one of the biggest determinants of a free economy. In practical terms, monetary stability isn’t just good for the economy; it’s good for our pockets. Stability equates to low mortgage payments. That’s the biggest assurance you can get.

Tracker mortgages: for mortgage advantages you can really bank on!