In a Standard Variable Rate (SVR) mortgage, the borrower’s monthly repayments are based on the prevailing rates of interest their lender charges — not the Bank of England (BoE) base rate. In other words, it is entirely the lender’s decision on the rate of interest they charge the borrower.

Although the rate of interest charged in a SVR mortgage can be influenced by changes in BoE base rate, whenever the bank raises or lowers base rate, the lender can do the same, or ignore the change altogether. On occasions, the lender may increase or decrease their rates of interest even if the BoE has not changed theirs.

The rate of interest charged on SVR mortgages can range from 2% - 5% above base rate, or more.

As SVR mortgages do not involve any special financial inducements, they can be more (or less)  expensive than other types of mortgages. And unlike fixed rate mortgages where the rate of interest never changes, SVR borrowers can never be certain what their monthly repayment is going to be.

Generally speaking, arrangement fees for SVR mortgages tend to be lower than for trackers or fixed rate deals and if the borrower pays off their mortgage sooner than planned, he or she may not incur an early repayment charge.

!

A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

Related

links

AIMS - Request a call back

Request call back.

or call us
028 90 288585

How We Can Help.

See below for the services we offer.

Mortgages

Mortgages are loans which are intended to help buyers purchase residential property. When an individual takes out a loan, the lender charges interest: the...

view more

Equity Release

Equity release is typically available to people who are over the age of 55 and have their own home with a significant amount of equity, but don’t have...

view more

Homeowner Loans

Lower payments and more disposable income is just around the corner

view more

Request call back.

or call us
028 90 288585

028 90 288585
93 Stockmans Lane,
Belfast BT9 7JD .

enquiries@aims-ni.co.uk