Homeowners urged to ‘turn to trackers’

Homeowners in the UK have been urged to seek out a base rate tracker mortgage if they are changing their policy over the next few months.

According to the Fool.co.uk, homeowners could limit their debt management problems by securing a deal that ensures any reductions in the base rate of interest are passed directly on to them.

The price comparison firm asserts that mortgage lenders do not necessarily pass on the Bank of England’s base rate cuts to their standard variable rate customers.

“High street lenders are currently more concerned with rebuilding their battered businesses than repairing consumers’ finances,” said David Kuo, head of personal finance at Fool.co.uk.

“Therefore, many homeowners are unlikely to reap the benefits, even though there are indications that the Bank of England may continue to cut interest rates to stimulate the flagging British economy.”

Including mortgage arrears, the typical household debt management burden in the UK is worth close to £56,000, according to data from the Credit Action charity.