Tracker mortgages 'more valuable than ever'

Mortgage adviser John Charcol has said that tracker mortgages are becoming an even more attractive product as the nature of the mortgage market continues to change.

The past few months have seen many lenders raise or change rates independent of any such moves by the Bank of England because of banks' reticience to lend to one another.

In this context, tracker deals – which follow the Bank of England's rate of interest – are gaining currency within the mortgage market.

"We have seen over the last few years that there is always a proportion of lenders who do not move their rate in line with the Bank's rate," said Ray Boulger, senior technical director at John Charcol.

"The starting point is, obviously, whether you want a fixed rate or a variable rate. But if you do want a variable rate, the choice is effectively between a discount off APR or a tracker.

"Most of the time, a tracker nearly always gets you better value than a fixed rate mortgage, providing the starting point is good," Mr Boulger continued.

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