card guide
Tracker Mortgages
These days consumers in the UK can select from a range of mortgage types and deals, with something to suit most needs, circumstances, and budgets.

One type of mortgage that is available on the market today is the tracker mortgage, also referred to as a base tracker mortgage. This type of mortgage is available from a variety of lenders, and by comparing different tracker mortgages you can find a deal that suits you in terms of the interest rate charged and the monthly repayments (which will vary based on fluctuation of interest rates in the UK).

A tracker mortgage is so called because it tracks the Bank of England base rate fluctuations. Basically, this type of mortgage applies the base interest rate and adds a set percentage to this. So, you could get a tracker mortgage that charges the base rate plus 0.5 percent.

When the Bank of England base rate falls your mortgage rate will also fall in line with it, and when the Bank of England interest rate rises your interest rate will rise in line with it. The amount that is charged over and above the base rate on tracker mortgages can vary based upon how long you have the tracker feature and also based on which lender you select.

With tracker mortgages you can choose to have a fixed period, such as two or three years, where the mortgage interest rate will track the Bank of England base rate. Once this period had expired the mortgage will revert back to the standard variable interest rate charged by the lender.

However, you can also opt for a lifetime tracker mortgage, which tracks the Bank of England base rate for the whole term of the mortgage, although the amount of interest charged over and above the base rate is generally set a little higher than on a tracker mortgage over a shorter period.

The benefit of a tracker mortgage is that it can be considered as a type of discount mortgage. Although lenders apply a set percentage to the base rate when it comes to the interest rate on these mortgages this is not as high as on a standard variable rate mortgage, where many lenders add around two percent to the base rate. Also, when interest rates fall the discount will be applied to your mortgage interest rate immediately, which does now always happen with a standard variable rate mortgage.

You can quickly and easily compare a range of tracker mortgages online, where a number of lenders offer this type of mortgage. By going online to compare tracker mortgages you can also make your application with speed and ease, which can save a great deal of time.

Related mortgage pages:

Posted on: [ July 01, 2018 ]       Add to   Digg it   Add to Blinklist   Add to FUrl   StumbleUpon