Thursday, 6 December 2007

Are Tracker Mortgages dying out?

Permanent TSB today announced that they are withdrawing Tracker Mortgage guarantees in the New Year. For those who don't know, a Tracker Mortgage is one which is at a variable rate, but the margin over the European Central Bank (ECB) rate is fixed for the life of the loan. Permanent TSB's news now means that they are only guaranteeing the margin for one year. Effectively this is no longer a Tracker Mortgage in the commonly accepted sense.

The stated reason is the cost of funds. I wonder if other lenders will follow suit. If you've been considering switching to an attractive tracker mortgage deal, maybe now is the time.