A capped rate mortgage is very similar to a fixed rate mortgage, in that there is a maximum interest rate set for a given period of time, and the rate you pay is guaranteed not to go above that rate for the agreed period.
However, with a capped rate mortgage, should the Bank Rate fall during that period the rate you pay for your mortgage will 'track' the interest rate downwards, reducing your mortgage repayments.
More mortgage basics
mortgage fees | variable | fixed | capped | tracker | discount | flexibleoffest | interest only vs repayment
