Tracker mortgage v normal mortgage ""Probably a stupid question...")

S

stumbeline

Guest
...but I am a complete novice.

Is a tracker mortgage a better option than a normal mortgage? Can anyone apply for a tracker mortgage and if not, what are the crietia?

Thanking you,
Stumbeline
 
Re: Probably a stupid question...

A tracker is simply a variable rate mortgage with a fixed margin, so you will always pay the ECB base rate + (say) 1.1%. A tracker should be available to everyone, buty the rate will depend on the amount you are borrowing/LTV. There are numerous threads dealing with 'which is the best mortgage'. Use the search facility or check the key posts in this forum.
 
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Re: Probably a stupid question...

Cheers,

I looked through earlier posts but couldn't find an explaination for what a tracker mortgage actually is.
 
Re: Probably a stupid question...

There are lots of posts on tracker mortgages and, in particular, how they compare to standard variable and fixed rate mortgages, which you should be able to find by searching/browsing.
 
Re: Probably a stupid question...

CCOVICH said:
A tracker is simply a variable rate mortgage without a fixed margin,
Click to expand...

Should that not be "with a fixed margin"?
 
Re: Probably a stupid question...

tracker good, svr (standard variable rate) bad.
 
Re: Probably a stupid question...

dam099 said:
Should that not be "with a fixed margin"?
Click to expand...

Yes, a tracker has a fixed margin over the ECB base rate for the life of the mortgage. It makes it completely transparent and easy to compare with other rates/offers. Margins vary between lenders and lower margins are available for larger loans and low loan to values.

Sarah

www.rea.ie
 
Re: Probably a stupid question...

dam099 said:
Should that not be "with a fixed margin"?
Click to expand...

Yes that was a typo on my part, kudos for spotting it.
 
There would be nothing stopping a lender reducing the SVR below a tracker. Just they have not done it yet.

There is nothing stopping the lender making the SVR higher than it is either, which is what they have done.

Tracker usually has a maximum difference between itself and 'repo';
When that goes up or down, your loan goes with it usually in a defined timescale.

Given that the next rate change is now almost upon us, it will be up.
 
WizardDr said:
Tracker usually has a maximum difference between itself and 'euribor';
When that goes up or down, your loan goes with it usually in a defined timescale.
Click to expand...

Techicnally euribor and the ECB rate are not the same, the euribor rate is the interbank offered rate and is generally slightly higher than the ECB rate and varies with time periods.

WizardDr said:
Given that the next rate change is now almost upon us, it will be up.
Click to expand...

How soon and how much?
 
Exactly, nobody knows what's gonna happen with rates. My GUESS is that they'll remain the same. I can't see any reason that the big eurozone economies have given for them to change. I'm not a financial professional at all at all mind!
 
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