Mortgage lenders increasing their standard variable rates
Banks and building societies have been steadily increasing their standard variable rates following the recent Bank of England base rate hikes.
Santander for Intermediaries has announced it is increasing its standard variable rate by 0.25% to 4.25%, while Halifax’s rate has increased by 0.25% to 4.49%. The Co-operative Bank’s standard variable rate has also been raised by 0.25% to 5.24%.
If your mortgage is coming to an end within the next four to six months, it is well worth checking the market to find out what you qualify for. Many lenders are increasing the rates to the point where there is one sub-2% fixed rate deal left.
Aaron Strutt, product director at Trinity Financial, says: “Borrowers typically revert onto a lender’s standard variable rate when the fixed or tracker rate finishes but our brokers work hard to ensure our clients avoid expensive reversion rates. A record £328 billion worth of fixed-rate mortgages will come to an end this year, according to figures in The Times."
Research from Hargreaves Lansdown
With 1.5 million fixed-rate mortgages set to expire this year, more than a third of respondents to a survey of 2,000 people in April, said they could face financial stress if the base rate hits 1.5%.
Hargreaves Lansdown senior personal finance analyst Sarah Coles was quoted as saying: “The rate rise may have looked relatively harmless, but with so many people’s finances on a knife edge, it risks pushing them into difficulties. Even this small increase could put one in ten people on variable rate mortgages under financial pressure.”
Coles continues: “If rates continue to go up, and the BoE rate reaches 1.5%, more than one in three could face real financial challenges. And while those on fixed-rate mortgages are protected, for now, 1.5m face the end of their term this year, and over a third might struggle with the extra cost.”
Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation