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Will the increase in Standard Variable Rates make you twist?
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Will the increase in Standard Variable Rates make you twist?

The last few weeks has seen more and more lenders announce plans to increase their standard variable rates, as the cost of borrowing between banks increases. Despite the Bank of England base rate staying at its record low of 0.5% for coming up to three years, the LIBOR rate, which record the cost of lending between the banks has increased, which has led to lenders increasing their SVRs.

The big two, Halifax and the Natwest/RBS group led the increases, with Bank of Ireland and Clydesdale and Yorkshire announcing plans to increase their rates in the coming months.

For customers who were enjoying the relatively low interest rates offered by the standard variable rates, the announcements will come as a bit of a shock and they will have to make a decision about whether to stick and pay the extra, or whether to twist and fix their interest rate for the coming years now.

In an ideal world customers would remortgage onto a fixed rate deal a few months before the base rate, or the cost of mortgage lending increased, protecting themselves from the increase for as long as possible. Unfortunately for many customers guessing when that point occurs is near enough impossible, but all the signs are that rates could increase.

The budget will give the majority of people in the UK more tax free money, and the drop in inflation could see the Bank of England given the confidence they need to increase the rate a little without fearing the fallout it may have caused a year ago.

One of the big decisions customers are having to make at the moment is remortgaging with the same lender, or shopping around for a better rate with a different lender. Often shopping around finds our customers the best deals, and they can save money in the long run if they are willing to look around.

With our huge range of comparison tables you can search a range of different fixed and tracker remortgage options, over two, three and five year periods. The charts also clearly show you the cost of each remortgage option, if it has a fee attached so you can work out your saving over the period of the fixed rate deal.

Sticking or twisting has been the ultimate homeowners question for nearly three years now, and the customers who twisted too early have come to the end of their 2 year fixed deals and are been asked the same questions again. With the average SVR rising, it could now be just the right time to twist.