The effects of the credit crunch and the economic slowdown in the UK has had a huge impact on this country’s banks, building societies and loan companies, particularly when it comes to lending on secured loans and homeowner loans.

Over the course of the past two years there has been a dramatic fall in the number of available loans for home buyers, across all types of different products, but since the recent rise in popularity of fixed rate loan products, due to the current low level of interest rates, one product type which has been hit particularly hard is that of tracker loans and mortgages.

Despite a general improvement in the number of available homeowner loan products over the course of the past six months or so, albeit from a record low level, the number of available tracker loans has continued to fall dramatically over the past twelve months.

According to the latest figures from moneysupermarket.com, the number of available tracker loans has fallen by 81 per cent since last July, as lenders are extremely reluctant to offer tracker loans whilst the market remains as volatile as it currently is and the base rate of interest remains so low. The majority of tracker products which remain on the market have a large margin above the base rate and when rates increase again in the future these could become particularly expensive for borrowers.

Louise Cuming of moneysupermarket.com said “The fall in tracker mortgages highlights how the last 12 to 18 months have seen a complete meltdown in the mortgage market. The figures show that four out of five tracker products available twelve months ago, when the base rate was five per cent, have disappeared.

Whilst it may not be surprising to see lenders pulling these products, it is a stark reminder that lenders call the tune and competition is no longer the name of the game. The flight of borrowers to fixed rates has definitely been precipitated by lenders who have decimated the choice of tracker rate alternatives.”