As many as 1.7 million borrowers currently on their lender’s standard variable rate could save by switching to the best current mortgage deals. That’s the conclusion of latest research by the Yorkshire Building Society.
According to their calculations, there are now no less than 2.3 million borrowers on their lender’s SVR, with1.7 million the total of those have a loan of 85% or less of their home’s value – or in other words at least 15% equity. The Yorkshire’s figures indicate that swapping to a new deal could save this group of borrowers as much as £1.8 billion in total.
Large numbers of borrowers have gone on to an SVR by default in recent years – as they’ve come to the end of two or five-year mortgage deals for example. Analysts point out that SVRs now face stiff competition from the best tracker and fixed-rate deals on offer. Meanwhile, a number of major lenders have deliberately raised their standard rates for new borrowers.
Fortunately, most borrowers currently on their lender’s SVR are free to find an alternative deal whenever and wherever they wish, although those with loans close to their property’s value will find things more difficult. Homeowners with more equity in their properties can take the opportunity both to remortgage and increase their borrowing, perhaps to pay off higher-interest debts or extend their homes.
If you are currently paying your lender’s SVR, it’s worth talking to a reputable broker such as Go Remortgage. They can help you review your finances, and present a range of options to enable you to make an informed choice about your mortgage.
Tags: Housing Market, Markets
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