When your existing mortgage product comes to an end, you’ll be moved onto your lender’s standard variable rate (SVR) unless you choose to switch to a new mortgage product.
All lenders have an SVR.
Some lenders will also let you take out a mortgage on their SVR, but this is usually the most expensive option.
How is the SVR calculated?
Every lender sets their own standard variable rate, and this can go up or down at any time.
While the SVR can be influenced by changes in the Bank of England base rate, unlike tracker mortgages, SVRs do not track the base rate at a set percentage.
They don't have to follow it. A lender can choose to raise or lower its SVR whenever it wants.
In practice, this means that if the base rate increased by 1%, a lender might decide to:
Increase its SVR by 1%
Increase its SVR more than 1%
Increase its SVR by less than 1%
Leave the SVR unchanged
If the base rate went down by 1%, a lender might lower its SVR by 1% or less, or not lower it at all.
How is Generation Home's SVR calculated?
We would normally expect any changes to the Bank of England Base Rate to be reflected in our SVR, but it is important to note that any changes do not have to be identical.
We will always aim to remortgage you into our best available rate before your mortgage product comes to an end and you're moved onto our SVR.