Standard Variable Rate

Date of publish – 16 November 2020
Updated – 21 January 2021

We recently reduced our Standard Variable Rate (SVR) linked to some of our mortgage products, as part of our commitment to provide competitive mortgages and help people own their own home.

What changed?

  • Residential SVR reduced to 3.96%
  • In England, Scotland, Wales and Northern Ireland (excluding Gibraltar and Jersey).

When did the Standard Variable Rate change?

The new rates were effective from 1 December 2020. 

Why did the rate change?

Most of our borrowing members have rates either linked directly to SVR or revert to SVR upon maturity.  This rate reduction provides our members with competitive SVR providing good value.   

What is a Standard Variable Rate?

A standard variable rate, or SVR, is the interest rate normally charged once an initial deal period on a fixed or tracker rate mortgage comes to an end. Standard Variable Rate (SVR) means customer’s payments can go up or down.

Unlike base rate tracker mortgages, SVRs do not track the Bank of England Base Rate, instead the rate customers pay on an SVR mortgage will be determined by their mortgage lender.

A SVR mortgage offers customers the benefit of being able to make unlimited overpayments without penalty allowing borrowers to reduce the interest on their mortgage and if maintained may mean they repay their mortgage earlier.

What did this mean for customers who have an SVR or SVR linked product?

These customers saw their interest rate and monthly repayments reduce with effect from 1st December 2020, with all affected customers contacted ahead of the change.

What did the customer need to do?

If the customers pay by Direct Debit then they weren’t required to do anything, we arranged collection of the revised monthly repayment. If however a customer pays by Standing Order then they would need to contact their bank to amend the monthly payments instruction.

The SVR is a variable rate, subject to ongoing review

The SVR is a variable rate, subject to ongoing review and may change in the future. 

 

YOUR MORTGAGE WILL BE SECURED ON YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.