From This is Money:
Fixed-rate deals have been falling over the past month, with many banks and building societies slashing them by as much as 0.5 percentage points.
Now the Monetary Policy Committee has said it believes pressures on inflation in the economy have eased, leading many economists to predict a base rate cut by the end of the year.
This makes tracker mortgages look attractive to those hoping to take advantage of a possible rate cut.
Cuts in the base rate are far from certain, so you should never take a tracker unless you can afford a possible sudden rise in your repayments. Some tracker deals have no fee and no early repayment charges – so you could switch to a new deal should rates increase from the current 5%.
Fee-free lifetime trackers have become a speciality at Barclays. It has a rate of 0.89 percentage points above base rate, giving a starting rate of 5.89%. You need a 40% deposit, but because there are no charges you can quit whenever you want. Initial monthly repayments on a &p…