Capped tracker mortgage from first direct

HSBC-owned first direct has launched a new offset tracker mortgage with an interest rate at 2.48% above the Bank of England’s base rate.

With the Bank of England’s base rate at 0.5%, this gives first direct’s mortgage a headline rate of 2.98%, or 3.2% APR.

Unlike any other tracker mortgage currently available, first direct’s product is capped at 4.99% until 2012.

The mortgage is available to new customers only for up to 75% of the value of the mortgaged property, and has a £1,499 arrangement fee.

Jimmy Kelly, first direct’s mortgage manager, said: “We wanted customers to be able to take advantage of the current low base rate and offer the security of knowing that their mortgage rate won’t go above 4.99% for the next three years.”

Earlier this year, Leeds Building Society launched a two-year fixed-rate mortgage at 3.4%, available at up to 75% loan-to-value (LTV).

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