Tracker mortgages 'may be best for certain borrowers'

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Tracker mortgages have emerged as the best option for those who do not need the security of a fixed rate deal, according to an expert.

Drew Wotherspoon of John has stated that the products could be popular due to the high probability that the Bank of England's interest rate will fall in 2009.

He added that those who take trackers may also want to consider those with a drop lock facility, which allows them to switch to a fixed deal whenever the time is right.

"Trackers are currently priced at around 0.3 per cent better than their fixed rate counterparts, so borrowers will immediately see less coming from their wage packet if they arranged a new tracker now over a fixed rate," Mr Wotherspoon explained.

"Yet with at least one per cent predicted to disappear from Bank Rate, this gap will widen significantly over the coming months."

Last month, John Charcol launched an exclusive range of two-year tracker products which include a current pay rate of 4.99 per cent and a 2.75 per cent arrangement fee.

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