The mortgage at base rate plus 2.08% comes with a £999 fee and is available for those with at least a 35% deposit. Borrowers who wish to pay a smaller fee, ie. £99 can get a rate of 2.99% (base rate plus 2.49%), while those with a smaller deposit of 25% , will get a rate of 3.24% (base rate plus 2.74%).

This facility allows borrowers to link their savings to the mortgage. Although they do not get any interest in return on their savings, they only pay interest on the balance of mortgage minus savings. If the buyer decides to move, the First Direct mortgages can be taken to new properties.

First Direct offers another great rate for those who have added bonus of an offset facility and the ability to leave at any time without early repayment charges. This is a very important feature, ie., with a rate of 2.58% may seem cheap now, this is base rate plus 2.08%, and when the base rate inevitably rises from its record low of 0.5% this lifetime tracker could get progressively more expensive.

So, if you are looking for a best tracker rate, go to First Direct. It could be another top deal, if it’s available to those with a 25% deposit.

Off-set Mortgage: Through reduced interest charges buyers pay off their capital at a faster rate. There is an advantage of overpaying this traditional mortgage, ie. the money paid into the linked savings account can be accessed if needed and interest charges may rise back up.

When using an offset mortgage or overpaying can be tax efficient, as Savings account interest is taxed at either 20% or 40% approximately and depends on saver’s income threshold. But, in the First Direct tracker at 2.58%, the savings equivalents would be 3.23% at 20% tax, or 4.3% at 40%. For 3.24% tracker the equivalents would be 4.05% and 5.4%, respectively.

The Bank of England has cut interest rates to 0.5% – a fresh all-time low – and says it will now boost the money supply to help revive the economy.

Interest rates have now been reduced six times since October, and the latest half a percentage point cut from January’s 1% had been expected.

The Bank said it would expand the amount of money in the system by £75bn in an attempt to boost bank lending.

This policy, so far untried in the UK, is called quantitative easing.

The Bank of England has reduced interest rates to a record low of 1% from 1.5% in an attempt to boost the shrinking economy.Lowest price ever

This marks the fifth interest rate cut since October, as the Bank seeks to encourage more lending.

However, there are concerns that savers will be hurt by lower interest rates.

And business groups argue that this rate cut will not be enough to ease the economic crisis, and will not encourage banks to lend.

The decision comes after official data showed the UK had entered a recession in December, after two successive quarters of economic contraction.

The Bank Rate has now been reduced from 5% in October last year.

In a statement, the Bank of England said that the rate cuts, along with government measures to boost the economy, “would provide a considerable stimulus to activity as the year progressed.”

HSBC maintains that only 1% of the bank’s mortgage customers are on SVRs.

Their new rate will fall from 6.25%to 5.44%.

Of HSBC customers with variable rate mortgages, over 95% have mortgages linked to the Bank of England base rate.

Earlier this month HSBC announced it was passing on the cut in full to all its tracker rate customers.

HSBC is also offering its existing SVR and discounted rate borrowers the option of moving onto the bank’s current ‘best buy’ lifetime tracker mortgage free of charge.

This makes for a £799 discount on the deal.

This lifetime tracker (currently 3.99%) charges 0.99% over Base rate for up to 60% LTV.