Many lenders have pushed their fixed rate products up in recent weeks in anticipation of a base rate cut this Thursday, but they could still be the best value for a number of borrowers looking at the bigger picture.
"The main reason to go for a fixed rate is for payment security," reiterated Paul Chafer, Stroud & Swindon's commercial director.
"However, should the Bank of England continue on its rate cutting agenda in 2008, borrowers could end up paying over the odds for fixing, so it may make more financial sense to opt for a tracker mortgage.
He advised that at this moment in time, hasty borrowers could get more than they bargained for, adding: "With interest rates expected to go down before they rise, it may make more sense to wait until they reach a point at which is more comfortable, and then arrange a fixed rate mortgage.
“With signs that variable rate mortgages are coming back in vogue, it is important that mortgage borrowers realise the difference between discounted or tracker mortgage rates.
"Trackers will follow the Bank of England base rate by a given margin, whereas discounted mortgages can be a discount off the mortgage lender's standard variable rate.
"However, borrowers should beware, the mortgage lender’s variable rate will not necessarily follow a reduction in the base rate, as we have seen in recent months.”
