Those with tracker mortgages are on course to save a total of £9 billion over the next year following the recent base rate cuts, it has been suggested.
Research by price comparison website uSwitch.com has revealed that the annual percentage rate has dropped to 3.27 per cent following the base rate cut of 2.5 per cent, with 616,350 tracker mortgage customers opting to reduce their mortgages by nine years by overpaying up to £260 per month and 31 per cent using the cash to pay household bills.
“For some homeowners, the onset of the recession has meant this extra cash is the lifeline they need to pay off any outstanding bills or debts they have accumulated over the last year,” Louise Bond of uSwitch.com remarked.
Tracker mortgage customers struggling with their finances may wish to draw up a debt management plan to decide how to most effectively use the extra money.
Abbey recently adjusted interest rates for many of its mortgages, with Nici Audhlam-Gardiner of the lender describing the new rates as “market-leading”.
By Tom Musk