Thursday 7th December 2006
Independent adviser John Charcol has recommended tracker rate mortgages following todays decision to maintain interest rates at five per cent.
The decision by the Bank of Englands monetary policy committee led John Charcol to suggest that many borrowers may no longer seek the security offered by fixed rate mortgages.
For those people, Ray Boulger of John Charcol said: "Trackers continue to look attractive and a tracker with a droplock option provides an added benefit."
"A droplock feature allows borrowers to literally drop the tracker rate and lock into a fixed rate deal," he added.
An alternative to this might be a capped tracker, according to Mr Boulger, who noted that some lenders are offering good deals over three and five-year introductory periods.
By taking a capped tracker mortgage, any future decrease in the base rate would be passed on to the borrower, without any increases being reflected in the lenders own interest rates.
John Charcol provides a range of advice for those taking new mortgages and those wishing to remortgage to take advantage of new introductory deals.
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