Fixed-Rate Mortgage
A mortgage where the interest rate stays fixed for an agreed period.
Read term →What is Standard Variable Rate?
A standard variable rate, usually shortened to SVR, is a lender’s standard mortgage rate that can go up or down.
Search other calculators & tools
Definition
A standard variable rate is a lender’s standard mortgage interest rate. It can change over time and is often the rate you move onto after an initial mortgage deal ends.
Standard variable rate in plain English
When a fixed-rate, tracker or discounted mortgage deal ends, the borrower may move onto the lender’s standard variable rate unless they choose a new deal or remortgage.
SVR is variable, which means the lender can change it. If the rate rises, your monthly payment can rise. If it falls, your monthly payment may fall.
Many borrowers try not to stay on SVR for long because it can be more expensive than a new fixed, tracker or discounted deal. The right choice depends on the available rates, fees, flexibility and your circumstances.
How a standard variable rate works
SVR is set by the lender rather than being a fixed deal rate. It may be influenced by wider interest-rate conditions, but it is not usually as direct as a tracker mortgage.
If your mortgage is on SVR:
monthly payment can change
because the interest rate can change
Higher SVR = higher monthly payment
Lower SVR = lower monthly payment
A lender may increase or reduce its SVR, and borrowers on that rate can see their monthly repayments change as a result.
Standard variable rate example
Imagine your two-year fixed mortgage deal ends. If you do not choose a new product and do not remortgage to another lender, your mortgage may move onto your lender’s SVR.
Before
Fixed-rate deal with a set monthly payment.
Deal ends
You either switch, remortgage or move to SVR.
After
SVR payment can rise or fall if the lender changes the rate.
Budget warning: moving from a fixed rate to SVR can create a payment shock if the SVR is much higher than your old deal.
Compare SVR with a new deal
Use the Remortgage Comparison Calculator to compare your current or SVR payment with a new mortgage deal after fees.
SVR vs fixed rate vs tracker mortgage
SVR is one type of variable mortgage rate, but it is not the same as a fixed rate or a tracker.
| Mortgage rate type | How it works | Main risk |
|---|---|---|
| Standard variable rate | Lender’s standard rate, which can change over time. | Payment can rise and the rate may be higher than other deals. |
| Fixed-rate mortgage | Rate stays fixed for an agreed period. | You may miss out if rates fall, and early repayment charges may apply. |
| Tracker mortgage | Usually follows a reference rate plus a margin. | Payment can rise if the tracked rate rises. |
Why SVR matters
SVR matters because it can affect your monthly payment after your initial mortgage deal ends. If you do nothing, the follow-on rate may become the rate you pay.
- It can increase your payment: especially if your old deal was cheaper.
- It can be more expensive: SVR is often higher than new mortgage product rates.
- It can offer flexibility: some SVR mortgages may have fewer early repayment restrictions, but you must check your terms.
- It affects remortgage timing: borrowers often compare new deals before their current deal ends.
- It is not guaranteed to track Bank Rate exactly: lenders set their own SVRs.
When you might pay SVR
You may pay SVR if your mortgage deal ends and you have not arranged a new product. You may also pay SVR if you choose to stay on it for flexibility.
- Your fixed-rate deal has ended.
- Your tracker or discounted deal has ended.
- You missed the remortgage window before your deal expiry.
- You plan to move soon and do not want to lock into a new deal.
- You want flexibility and accept the higher variable-rate risk.
Practical step: check your mortgage deal end date early so you have time to compare new deals before moving onto SVR.
Main risks of a standard variable rate
The biggest risk is payment uncertainty. Because the rate can change, the monthly payment can change too.
- Payment shock: your payment may jump after a fixed or discounted deal ends.
- Rate uncertainty: the lender can change the SVR.
- Higher cost: SVR may be more expensive than a new fixed or tracker deal.
- Budget difficulty: variable payments can be harder to plan around.
- Inaction cost: doing nothing at deal end may leave you paying more than necessary.
Red flag: if you are moving onto SVR because your deal is ending, calculate the new payment before it happens.
What to do before moving onto SVR
Before your current mortgage deal ends, compare your options. The best choice may be a new deal with your current lender, a remortgage to another lender, staying on SVR temporarily, or getting advice.
- Find your current deal end date.
- Check the follow-on SVR and estimated monthly payment.
- Compare new fixed and tracker deals.
- Include product fees, legal fees, valuation fees and exit fees.
- Check whether early repayment charges apply.
- Decide whether certainty, flexibility or lowest total cost matters most.