A handful of lenders now offer and promote their totally flexible tracker rates, with some as low as 1.09%. A large number of borrowers generally opt to place their mortgage on a fixed rate, so that they know what their monthly payments will be for a set period of time.

Feedback suggests that tracker rates may become a more popular choice over 2015, for a number of reasons.

Trackers are fairly competitive, as they track the Bank of England’s base rate that is currently, and has been, sat at 0.5% for a number of years. There has been a lot of focus on the best buy fixed rates, which means there’s a possibility that trackers have been slightly overlooked.

It is usually the total flexibility that most trackers provide that is most appealing. You can make lump sum payments and overpayments whenever you like without penalty. Some trackers last for a set period of time, as do fixed options, but there are plenty available that can run for the life of the mortgage.

The main thing to remember is that, should the base rate be increased, monthly payments would increase as the rate being tracked is higher. Most trackers have no tie-in period, so if rates did start to increase, the borrower would be able to review their options and choose to fixed rate instead.

As a mortgage advisor, part of the advice process that you follow will enable you to ascertain what your customer is looking to get from their mortgage, and their repayment intentions (if they wish to pay off lump sums, for example). In order to give such advice, you must complete your CeMAP training and achieve a pass grade in the end exam.

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