For those borrowers willing to track for a longer term, Barclays are the only lender offering this, one of which is an Existing Mortgage Customers Reward tracker with an initial rate of 5.35% and a product fee of £999.
For those borrowers willing to track for a longer term, Barclays are the only lender offering this, one of which is an Existing Mortgage Customers Reward tracker with an initial rate of 5.35% and a product fee of £999.
Check back weekly or favourite this page to keep an eye on the ever-changing rates. The table below is updated as of November 12, 2024 and rates are subject to change.
5 Year Tracker Mortgage rates
| COMPANY | TYPE | TERM | INITIAL RATE | THE OVERALL COST FOR COMPARISON IS | PRODUCT FEE | LOAN TO VALUE (LTV) |
|---|---|---|---|---|---|---|
| BARCLAYS | 5 year Offset Tracker at BEBR + 1.25% for 5 years Residential Purchase Offset | 5 years | 6.00% | 6.7 APRC | £1749.00 | 75% |
| BARCLAYS | 5 year Tracker at BEBR + 0.60% for 5 years Rate | 5 years | 5.35% | 6.4 APRC | £999.00 | 60% |
| BARCLAYS | 5 year Tracker at BEBR + 1.00% for 5 years Rate | 5 years | 5.75% | 6.6 APRC | £999.00 | 85% |
| BARCLAYS | Residential Remortgage Offset Tracker at BEBR + 1.25% | 5 years | 6.00% | 6.7 APRC | £1749.00 | 75% |
| BARCLAYS | Residential Remortgage Tracker at BEBR + 0.60% | 5 years | 5.35% | 6.4 APRC | £999.00 | 60% |
| BARCLAYS | Residential Remortgage Tracker at BEBR + 1.00% | 5 years | 5.75% | 6.6 APRC | £999.00 | 85% |
| BARCLAYS | Existing Residential Mortgage Customers Reward Tracker | 5 years | 5.35% | 6.3 APRC | £999.00 | 60% |
| BARCLAYS | Existing Residential Mortgage Customers Reward Tracker | 5 years | 5.75% | 6.5 APRC | £999.00 | 85% |
| BARCLAYS | Existing Residential Mortgage Customers Reward Offset Tracker | 5 years | 6.00% | 6.7 APRC | £1749.00 | 80% |
5 Year Tracker Mortgage FAQs
What is a 5-year tracker mortgage?
A 5-year tracker mortgage in the UK is a type of mortgage where the interest rate is linked to the Bank of England's base rate, and it remains fixed for a period of five years.
The Bank of England's base rate is the interest rate that the Bank of England charges to other banks for borrowing money. When the base rate changes, the interest rate on a tracker mortgage will also change by the same amount. For example, if the Bank of England increases the base rate by 0.25%, the interest rate on a 5-year tracker mortgage will also increase by 0.25%.
A tracker mortgage usually has a margin or percentage above the base rate that the lender charges to cover their costs and make a profit. The margin can vary between different lenders and products.
A 5-year tracker mortgage can be a good option for borrowers who want to take advantage of potential interest rate reductions during the five-year period. However, it's important to note that the interest rate could also increase, so borrowers need to be prepared for the possibility of higher mortgage payments. It's also worth noting that the interest rate on a tracker mortgage can be higher than the interest rate on a fixed-rate mortgage, as there is no certainty about future interest rate movements.
Is a 5-year tracker mortgage better than fixed?
The suitability of a 5-year tracker mortgage versus a fixed-rate mortgage in the UK depends on various factors, such as personal circumstances, preferences, and the prevailing economic environment. When comparing tracker and fixed-rate mortgages, consider the following factors:
5-year tracker mortgage advantages:
- Transparency: A tracker mortgage ties interest rates to the Bank of England's base rate, providing clear insight into interest payments.
- Flexibility: Some tracker mortgages permit penalty-free overpayments, allowing for faster mortgage repayment.
- Lower initial interest rates: Tracker mortgages may offer lower interest rates than fixed-rate mortgages at the outset, resulting in cost savings in the short term.
5-year tracker mortgage disadvantages:
- Risk: Tracker mortgages are tied to the Bank of England's base rate, and if the base rate rises, monthly payments can increase, resulting in financial strain.
- Uncertainty: Interest rates can be unpredictable, making future mortgage payments uncertain.
- Early repayment charges: Some tracker mortgages have early repayment penalties when switching to a new mortgage before the initial term is up.
Fixed-rate mortgage advantages:
- Certainty: A fixed-rate mortgage provides certainty for a specified period, typically two to five years, making it simpler to budget and plan for mortgage payments.
- Protection: If interest rates increase, fixed-rate mortgages provide security by keeping monthly payments the same.
- Peace of mind: A fixed-rate mortgage can alleviate financial strain by providing stable mortgage payments.
Fixed-rate mortgage disadvantages:
- Less flexibility: Fixed-rate mortgages may have restrictions on overpayments, limiting the ability to pay off a mortgage quickly.
- Higher initial interest rates: Fixed-rate mortgages usually have higher interest rates at the outset, resulting in higher costs in the short term.
Choosing a 5-year tracker mortgage or a fixed-rate mortgage depends on personal circumstances and preferences. If transparency and flexibility are valued, and some risk is acceptable, a 5-year tracker mortgage may be suitable. If certainty and protection against rising interest rates are a priority, a fixed-rate mortgage may be a better option. It's essential to weigh all factors carefully before choosing a mortgage product.
Is a 5-year tracker mortgage a good idea?
A 5-year tracker mortgage can be a good option for some borrowers, depending on their individual circumstances and financial goals. One of the main advantages of a 5-year tracker mortgage is that it offers transparency and flexibility since the interest rate tracks the Bank of England base rate, so borrowers can see how their mortgage payments are affected by any changes in the base rate.
However, it's important to note that tracker mortgages come with some risk, as borrowers' monthly payments can increase if the base rate rises—which we have certainly seen a lot of lately. Borrowers should also be aware that tracker mortgages may have higher fees and interest rates than fixed-rate mortgages, and they should be prepared for the possibility of higher monthly payments if the base rate increases.
