A mortgage with a rate below 1 per cent might seem like a dream come true. Well, Halifax has gone and made it a reality with the launch of the new Halifax tracker mortgage.
Related: Calling all first time buyers! Halifax has launched a new no-deposit mortgage
The new Halifax mortgage is the first mortgage to offer a sub-1 per cent rate since November 2018. The Halifax tracker mortgage was launched last week with an incredible rate of 0.98 per cent.
Halifax tracker mortgage
It is a two-year 'tracker' mortgage. This means that while the rate is currently at 0.98 per cent, over the two years the rate could go up or down. It is tied to the Bank of England base rate, so if that base rate rises or falls the Halifax mortgage rate will too.
While the Halifax tracker mortgage rate is the stuff of dreams, it does come with a few catches. It is only available for home movers and comes with a fee of £999.
You also have to purchase the Halifax tracker mortgage via a broker and you can only borrow up to 60 per cent of the home's value. So, if you do choose to go for this mortgage you will need to have a 40 per cent deposit for your new home to hand.
Once the two-year period is up, your mortgage rate will revert to the bank's standard variable rate which is currently 4.24 per cent.
While the Halifax tracker mortgage is currently a fantastic rate, there is also the risk that the rate can go up and down. Plus, the deposit requirements mean it might not suit everyone.
Even so, the new Halifax mortgage rate is very good news if you are looking to save money on your mortgage. It is an indicator of the sustained downward trend in mortgage rates.
Fixed-rates have previously pointed to this, as they have been getting cheaper. The cheapest two-year and five-year fixed-rate mortgages were 1.39 per cent and 1.79 per cent, but in the last six months, they've dropped to 1.05 per cent and 1.44 per cent.
If you are coming to the end of your mortgage deal now is the perfect time to shop around.
Related: Halifax figures reveal UK House price growth at slowest rate in six years
See if you can find a deal that will cut the cost of your mortgage rate.
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