The mortgage is fixed for the first two years at 5.19 per cent and then reverts to a lifetime tracker at 0.19 per cent above Base Rate. There are no early repayment charges after the initial two year fix.
Andy Gray, head of mortgages for Woolwich, said: “Economists are divided over how much higher interest rates will go with many expecting one if not two further rises. This product allows borrowers, nervous about short term interest rate movements, to fix now to cover any short term hikes but then have the advantage of switching to a market leading lifetime tracker in two years which could have the advantage of tracking rates down if the interest rate situation takes a turn for the better.
"Of course the other advantages are that borrowers should come out from one very competitive rate to another meaning they do not have to go through the usual two yearly mortgage switching process that has become endemic in recent years."
This product will not be for everyone so Woolwich are also continuing their 10-year fix at 4.98 per cent and 5.17 per cent lifetime tracker (Base +0.17 per cent).
The mortgages being launched by Woolwich are:
Two-year fix followed by lifetime tracker - two-year fixed rate at 5.19 per cent until 31/01/09 following onto Base +0.19 per cent; 80 per cent loan-to-value; Early repayment charge is 3 per cent of the balance until 31/01/09. Application fee £995.
Buy to Let - lifetime tracker at +0.49 per cent above Base Rate with no early repayment charge.
Buy to Let – five-year fixed re-mortgage package at 5.89 per cent, no valuation or legal costs.
