Published: 9 January 2025
What is Standard Variable Rate (SVR)?
SVR stands for Standard Variable Rate and each lender sets their own SVR. Some lenders may call it something different, but it is essentially the same thing.
A Standard Variable Rate (SVR) mortgage is the rate your lender switches you to when your existing fixed, tracker or discount mortgage deal ends (unless stated otherwise in the product details).
When you’re switched to an SVR mortgage, the interest rate is variable. So, if the lender raises the SVR, your monthly mortgage payments will increase. But if the SVR is reduced, these will also decrease.
Things to consider with an SVR mortgage
• The lender can change the SVR when they decide, meaning payments can go up and down.
• Some lenders have higher rates than others.
• If you don’t want to move to SVR, you’ll need to arrange a new mortgage deal before your current mortgage deal ends.
Is SVR the same as the Bank of England Base Rate?
No, the Bank of England Base Rate and a lender’s SVR aren’t the same. Mortgage lenders may change their Standard Variable Rate when the Bank of England Base Rate increases or decreases. So, although the base rate may contribute, it makes up one of many things a lender considers when setting the interest rate.
So, what are my options when my mortgage deal ends?
Stay on SVR
You could overpay your mortgage as much as you like. You could even pay your mortgage off early – as usually, no early repayment charges apply. However, your monthly payments are likely to increase.
Switch to a new deal
You can also choose to look for a new deal with your current, or another mortgage lender. Usually, you can arrange a new deal before your current one even ends.
Unsure what to do next?
Speak to your mortgage broker or financial adviser. Or book a mortgage appointment online with a member of our friendly team.
Your property may be repossessed if you don't keep up your mortgage payments
This article is not advice, you should seek independent financial or legal advice if needed.
