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Tesco Bank launches sub 1% tracker mortgage

Owain Thomas
Written By:
Owain Thomas

Tesco Bank has become the latest lender to cut mortgage rates, offering the lowest variable tracker rate ever recorded by data firm Moneyfacts.

Tesco Bank’s two-year tracker at 0.98% is available for home purchases at up to 60% loan-to-value (LTV) with a £1,495 product fee.

The lender has also reduced rates on a selection of two, three and five-year fixed-rate products.

The new rates include: 1.92% for the 60% LTV fixed for five-years with no product fee and 2.12% for the 75% LTV fixed for five-years with no product fee.

Moneyfacts confirmed the fixed rate changes put Tesco just behind the cheapest deals on the market.

In April, Yorkshire Building Society launched the lowest ever mortgage rate for direct customers – a two-year discount variable at 0.89%.

Tesco Bank managing director David McCreadie said: “We are pleased to introduce our new reduced rates on a selection of our two-, three-, five-year and tracker mortgage products to help customers buy or remortgage their home.

“Alongside our competitive rates, we also offer customers the unique added benefit of collecting Clubcard points on their mortgage repayments.”

Should you switch mortgage deal? See Record low mortgage rates: is it worth paying a penalty to get out of a fix early?