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Popularity of tracker and discount mortgages 'growing'

25 July 2007
Tracker and discount mortgages are growing increasingly popular, according to a lender.

GMAC-RFC is predicting that demand for tracker and discount deals are set to rise over the year ahead.

Because of the increase of term fixed-rate deals, the rift between fixed and discounted (or tracker) products has widened, which will make variable options more attractive, GMAC-RFC said.

Up to £1026.72 could be saved over two years by a self-certification borrower who opted for the GMAC-RFC two-year discounted variable rate mortgage, the lender said.

Julie Gaskin, corporate relations manager at GMAC-RFC, said: "The tide is now turning and fixed-rates currently on offer are higher than we have seen for several years, as they are factoring in for one or more future rate rises."

She added that demand for tracker and discount mortgages "will inevitably increase in the foreseeable future".

Figures from the Council of Mortgage Lenders (CML) show that since the start of 2007 more than three quarters of all mortgages have been taken out on fixed-rate deals.

Find out more about fixed-rate mortgages

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