Customers who are currently on super low tracker mortgages and paying close to 0% interest now face paying thousands of pounds a year in interest, as their mortgage deals come to an end.

Thousands of homeowners will face the decision of whether to remortgage their property, especially in light of the Bank of England’s quarterly inflation report which suggests that interest rates could remain low.

Halifax, Co-op, Birmingham Midshires and Cheltenham and Gloucester customers who took advantage of their two year tracker mortgages in 2007 have been paying zero per cent on their mortgage loans as the Bank’s rate dropped to below one per cent since the early months of this year.

As the deals now come to an end, customers will face paying up to £8,000 in interest as the deals revert to Standard Variable Rates (SVR’s) with interest rates as high as 4.24 per cent.

Fixed term deals are not giving customers much incentive to switch and remortgage as the average cost of a fixed-term mortgage rose during June and July to 5.7 per cent.

Moreover, many will not be able to switch to a new mortgage deal, as bank valuations of properties could leave some in negative equity and therefore unable to switch to another provider.

Despite recent speculation that the Bank of England’s base rate would likely rise towards the end of the year or the beginning of 2010, the inflation report suggests that interest rates are likely to remain on hold for the remainder of 2009 and throughout next year.