Going for my first tracker! Anyone else?

[Freetodowhatiwant]

As the title suggests I have hopefully just arranged my first ever tracker mortgage. I've had a really tough time reaching the mortgage repayments for the last two years - fixed at 4.69 thanks to Liz Truss (and I realise they could also have been higher) and now my rate is due to end. My bank app said I could select a tracker so I have done. At the moment it's 0.29% above the base rate which due to having extended the loan (by only 5 months as that is all they allowed) it means the new tracker repayment at today's rate (today, pre-interest rate announcement on Thursday, it's 5.04) is the same monthly repayment as my fix at 4.69%. So hopefully this will only go down. I am taking a risk I realise. Excited yet nervous. Hoping some of you fellow interest-rate junkies will relate. Anyone else going to be brave/risky and take a tracker?

I always used trackers, throughout the whole length of my 25 year mortgage.

I was better off at the end than if I had fixed. By about £40k over 25 years.

It's not really a gamble because you will always lose out taking on a fixed rate mortgage otherwise banks wouldn't offer them. I can see the attraction of them though as in you always know what you're going to be paying.

Following with interest.

You are brave to opt for a tracker but it may well work out for you.

My daughter is currently looking to remortgage and deciding between a tracker or 2 year fix.

That's not necessarily true! We got a ten year fix at interest rates less than 1.5% and that was just before the interest rates shot up a few years ago. Surely that's better?

I kind of agree that banks only offer fixes that they think will be advantageous to them.

But they aren’t always right … lots of people benefited from being on very low fixed rates when mortgage rates rose in quick succession in recent years.

Over a 25 year period though I can see you could lose out by always having fixed rate mortgages because on the whole, the banks know more about what is likely to happen to rates than the average person making the decision.

Personally I'd never used one.
We got fixed deals every time , so we knew where we were.

We took out a tracker in 2006. We moved 6+ hours away from family and I was not sure I would want to stay. We had just been stung for early fees for this move (work related) so it gave us some flexibility.

After the 2008 crash, our repayments were cut by £300/month so a win in our case.

I've just gone onto a tracker too. My 1.64 mortgage has come to end and we've moved house so the mortgage is nearly 3x what it was. Vaguely hopeful rates might come down in a year or so and I might take a fix then

Trackers are currently a fair bit higher than fixed at my bank for low loan to value mortgages. Do you think interest rates are coming down appreciably in the next 2 years?

I've had a tracker before because we were considering moving, so didn't want to be trapped by an early repayment. Tracker was cheaper than fixed then. However rates went up and we didn't move so a fixed would have saved us a coupler of thousand over 2 years. I chose poorly at that time.

Following 'with interest' with no pun intended :)

That's fascinating and yes a good point I had never really thought of (duh!) about the banks not offering fixes unless they thought they were going to earn on them. My current repayments are VERY difficult for me to manage though and the tracker on today's rate already comes out as equal to these so I am hoping that in the next two years things will only go lower/won't go any higher than the current 4.75%.

Yes, bar anything weird and unexpected happening, all estimates do seem to think that rates will slowly be coming down. Not to the historically lows we saw pre-Truss but to, again it is estimated, something beginning with a 3.

I am excited about it! yes I realise I need to get out more. But at the current 0.29% over base rate (makes it 5.04) the repayments are pretty much exactly the same as my current fix at 4.69% as I managed to extend the term (albeit by only a paltry 5 months due to my age). So the term is now 19 years and 5 months and I have a two year tracker starting early March.

My current repayment a month is hideous but I only bought two years ago after divorce and at the time I figured I will grit my teeth and hope interest rates would be a lot lower two years later. As it turned out they are NOT currently lower so I am now banking on them going lower by taking out a tracker. Can't wait to see how it goes. Fingers crossed nothing hideous happens to push them up otherwise I will be truly stuffed.

@Twiglets1 tell your daughter to be brave and for the tracker. All indications are they have to be at least a BIT lower than the current 4.75. Hopefully towards the 3s but even the early 4s would be better.

Haha - yes, no pun intended!

It'll be interesting to see what happens. National insurance and minimum wage increases are increasing inflation in the short term. Maybe an end to the Ukraine war might lower inflation.

We're started a tracker just over a year ago, then it was equitable with fixed, it's come down twice in the last 6 months , so we're paying less (although we still pay the same amount as we were it's just an overpayment now) there's also no exit fees or overpayment limits, unless interest rates get really low again (at which point I might fix for ten years and aim to pay off by the time it ends) , I can see us sticking with a tracker

I was one of those people who got stuck on a 'high' rate, in reality it was about 4.80% or something, for 5 years when so many people were paying close to zero after the credit crunch of 2007/8 so I always felt a bit bitter about this. I am really excited about my tracker now. If the BoE reduced the rate on Thursday to 4.50 I will already be paying about 40 quid less a month. I have everything crossed for a whole row of cuts now. Watch this space!

With trump starting trade wars in the US I'd be worried about interest rates increasing.