As lenders hike their SVRs, it may be time to remortgage
The average standard variable rate (SVR) rose from 4.72 to 4.85 per cent in September, following the quarter-point hike in Base Rate, according to research from Moneyfacts. It means the difference between the average SVR and the average two-year fixed-rate mortgage is now 2.41 per cent, the greatest difference in a decade.
If ever there was a reason to remortgage, this surely is it. With Base Rate rising twice in the past year, there is nothing to say that it won’t rise further – and if you are on your lender’s SVR, that means a guaranteed jump in mortgage payments.
Some borrowers may be sat on their lender’s SVR because they believe themselves to be mortgage prisoners – unable to remortgage onto a better deal due to changes in their circumstances or affordability criteria. While this may have been the case even only a few months ago, lenders have pledged to offer better rates – although not necessarily the cheapest ones – to existing borrowers who don’t meet their criteria, for whatever reason.
There may be a better deal out there for you – it is certainly worth investigating to find out whether this is the case.
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