tracker mortgages

With a base rate tracker mortgage the rate of interest you pay is tied to the base rate set by the Bank of England.

Typically the tracker mortgage rate will be set as a percentage above the base rate. Although the resulting interest rate is usually lower than a mortgage lender's standard variable rate, this will vary from lender to lender. A main advantage of a tracker mortgage is that the difference between the tracker rate and the base rate is usually a lot smaller than the margin between a standard variable rate and the bank base rate. Therefore you will end up paying less overall. However, you should remember that the bank base rate can also rise which may effect your monthly budgeting.