With base rates reaching 5.25 per cent and expectations that they will go higher still, Woolwich has launched the UK’s first lifetime tracker (base + 0.23 per cent) with the optional protection of a ‘cap’ at 5.99 per cent for the first two years of the mortgage.
The mortgage is guaranteed to stay at 0.23 per cent above base (current rate of 5.48 per cent) with no arrangement fee or early redemption charges. Consumers who are worried about future rate rises can take advantage of the ‘cap protection’ which guarantees the rate will not rise above 5.99 per cent for the first two years. This protection is available for a one off £595 fee which is well below many competitor application fees.
Andy Gray, head of mortgages for the Woolwich, said: “Fixed rates are still expensive in comparison to trackers and with SWAP rates heading ever higher they don’t look as if they are going to get any cheaper in the short term. This is why we have launched this unique product, track and cap if you like, with no lock-ins it gives consumers the best of both worlds – a market leading rate with a guarantee, so if rates go up you are protected and if rates head south you win.
“Most traditional capped rate mortgages are not linked to a base rate tracker, so it can be hard to get any real benefits when rates start to fall. With this you still get all the benefits of a base rate tracker in terms of flexibility but with the benefit of protection for the first two years after completion”
“Overall we believe this is the best mortgage available in the market. The lowest long term rate, a capped upper rate if you want, and at the same time flexibility to overpay, pay off the mortgage early, move house and re-mortgage.”
