Standard variable Vs Tracker mortgage

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shaktoo

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which one is the best standard Variable or Tracker Mortgages. especially as interst rates are expected to rise in the near furute
 
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Re: STANDARD VARIABLE Vs TRACKER MORTGAGES

They have been saying that rates would increase for years now but they haven't yet. In general a low margin tracker is a better bet than a standard variable rate with no margin guarantee to minimise long term mortgage interest costs. If you can afford fluctuating repayments then go for the lowest margin tracker available to you. Standard variable rates offer no guarantee about the margin charged and the lender could increase it at any time.
 
Re: STANDARD VARIABLE Vs TRACKER MORTGAGES

I'm new to this game but i've done lots of research and as far as I'm concerned, a variable mortgage is essentially a tracker without any guaranteed maximum relative to the ECB rate
 
Re: STANDARD VARIABLE Vs TRACKER MORTGAGES

I remember reading an article in the Sunday Times a few years ago. They studied tracker, variable & fixed rate mortages over a ten year period. The bottom line was that the tracker worked out best value in the long run.

As for interest rates rising - the Irish economists have been predicting rises for the past two years now, but still no sign? If you look at the European statistics, all indications are that they will fall this year to stimulate further growth!
 
Re: STANDARD VARIABLE Vs TRACKER MORTGAGES

doggy said:
... a variable mortgage is essentially a tracker without any guaranteed maximum relative to the ECB rate
Click to expand...

Which means that it's not a tracker. A tracker, by definition, charges a guaranteed rate of ECB + margin. A variable rate will follow the ECB rate but does not guarantee the margin.
 
thanks everyone.my next query is how to change about the variable to a tracker mortgage.i am currently with IIB and if anyone who have done the reseach already could please suggest the best tracker mortgage product i would be grateful.thanks. i would still be able to pay extra payements with a tracker as well wouldnt i?
 
The best buys list in the section lists the cheapest trackers available for various criteria. To switch, first try haggling with your existing lender to match the best offer available elsewhere. If this doesn't work then you will have to consider moving to another lender if the benefits (in the form of lower ongoing interest costs) outweigh the costs (the remortgaging legal/conveyancing/ancillary costs if the new lender does not cover or subsidise these). contains some useful information about (re)mortgaging. To estimate the potential savings attributable to different mortgage packages try Karl Jeacle's mortgage calculator.
 
I moved from BOS (ECB + 1%) to the Ulster tracker (ECB + .85%), and Ulster covered the legal fees involved. Note: Ulster only pay brokers half the normal commission on this product so it's not widely promoted by them.

NIB have the best tracker (ECB +.79%), but only make a contibution towards the legal fees (€600 - from memory?). Also, I think they don't pay brokers any commission, so again it's not widely promoted.

Maybe Sarah from REA can confirm?
 
In theory of course, variable could be cheaper than a tracker mortgage at some stage right? They could hold the variable at such a rate to be less than the margin on the tracker....
 
Yes - but in practice this has never happened as far as I'm aware. Based on all the information available a tracker with a guaranteed margin over the lifetime of the loan is a better bet on reduced interest costs than a variable rate with no margin guarantee.
 
Lemurz said:
I moved from BOS (ECB + 1%) to the Ulster tracker (ECB + .85%), and Ulster covered the legal fees involved. Note: Ulster only pay brokers half the normal commission on this product so it's not widely promoted by them.

NIB have the best tracker (ECB +.79%), but only make a contibution towards the legal fees (€600 - from memory?). Also, I think they don't pay brokers any commission, so again it's not widely promoted.

Maybe Sarah from REA can confirm?
Click to expand...

I can confirm (being a broker!) Correct about Ulster Bank and the switcher mortgage, and about NIB (NIB are due shortly to change this, but they dont have a tradition of dealing with brokers)
 
I changed from a standard variable to tracker with IIB by just phoning and asking the question. They even gave me the ECB +1.1 rate even though my mortgage doesn't fall under the applicable threshold...
 
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