10-Aug-2007
A tracker mortgage is a mortgage product where the interest that you pay on your home mortgage loan tracks the Bank of England base rate. This means that your repayments each month will fluctuate, depending on the base rate, although typically tracker mortgage rates are set to be a few percentage points higher than the base rate. Although when the base rate is low you will save significantly on your mortgage repayments through having a tracker mortgage as opposed to a fixed rate loan, the obvious downside is that you could be in danger of paying considerably more than the average fixed rate when the base rate rises again.
Due to the risks involved, you should consult a qualified mortgage adviser before proceeding with a tracker mortgage. In a turbulent economic climate, the interest rates can fluctuate substantially, and depending on your priorities, you may wish to have a monthly mortgage payment that remains the same. In fact, a fixed rate mortgage with a long tie-in period (up to 15 years) may offer you a rate that is as competitive as that offered by the tracker mortgage, without the same element of risk. Consulting a mortgage expert is therefore valuable, there is a lot to lose if you are unable to make your repayments and there may well be a suitable alternative in the market.
If searching through hundreds of mortgage quotes doesn't really appeal, let SimplyFinance do the searching for you. Take a moment to fill out our short mortgage form, and we will connect you with a qualified expert who will be able to answer any tracker rate mortgage questions you may have, and once you're sure it's the right type of mortgage for you, they will do their best to find the best tracker rate mortgage deal for you.
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