Variable rate mortgages are once again becoming popular and one industry expert has moved to warn consumers they differ from Tracker Mortgages.
Paul Chafer of Stroud & Swindon is worried that many people don't know the difference between Tracker mortgages and variable mortgages, leaving them open to nasty surprises once they've signed their agreement.
He commented, "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."
He added, "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.”