A tracker mortgage is dependent on the Bank of England Base Rate, meaning when this fluctuates, your monthly repayments will also change accordingly.
The interest payable on a tracker mortgage is usually a certain margin above the Bank of England Base Rate – for example, the Base Rate plus 1.00%, with some trackers having a “floor” below which the rate will not fall.
Lifetime trackers track the Base Rate for the full life of the mortgage. They tend to be at a higher rate than other trackers, but due to not needing to switch lenders or products every few years, they could work out financially better for you.
It is important to note that the Bank of England Base Rate is currently 4.75%. This means that when the Base Rate changes, your monthly repayments will also change. If the Base Rate rises, your repayments will increase, and you could consider switching rates, although an early repayment charge may apply.
Some Buy To Let Mortgages are not regulated by the Financial Conduct Authority
