The new product will be the UK’s first ever lifetime tracker that offers an optional protection cap at 5.99% for the first two years of the mortgage. It guarantees to stay at 0.23% above base, which is currently at 5.48%, with no arrangement fee or early redemption charges. The cap protection is available for a one off fee of GBP595, which, compared to other competitors, is lower than the average application fees.
Most traditional capped rate mortgages are not linked to a base rate tracker, so it can be hard to get any real benefits when rates start to fall, said Andy Gray, head of mortgages for the Woolwich. With this you still get all the benefits of a base rate tracker in terms of flexibility but with the benefit of protection for the first two years after completion.
The new mortgage product is available to all existing and new customers. For customers switching from other lenders, Woolwich has stated that it would cover legal and survey fees. In addition to this innovative product, the bank will also launch a 10-year fixed-rate mortgage at 5.37% and a two-year discounted tracker rate at 4.99%.
