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Do I have to take a fixed rate deal?

Shielder
Shielder Posts: 80 Forumite
First Anniversary Combo Breaker First Post
in House buying, renting & selling
We're looking to move house in the near future, but the mortgage deals that we could get from the bank include fixed rate deals that are higher interest than the bank's SVR.

I'm just wondering if we have to take a fixed rate deal or whether we can just go straight onto an SVR?

Thanks

Andy

Comments

  • princeofpounds
    princeofpounds Posts: 10,396 Forumite
    First Post Name Dropper First Anniversary Combo Breaker
    SVR is not quite the same thing as a variable mortgage. It describes a rate for a 'default' deal that people end up on once fixed, capped or discounted rates revert to once the initial deal ends.

    Of course you can take a variable mortgage (generally - obviously a lender has to want to lend to you). They are very common in the UK (a bit stupid I think on a systematic level, but these things tend to be rather cultural).
  • Mobeer
    Mobeer Posts: 1,851 Forumite
    Academoney Grad First Anniversary Photogenic First Post
    You can take a variable rate mortgage rather than a fixed rate mortgage. The rate will likely be lower now on the fixed rate, but this can change at the decision of the lender. A tracker mortgage based upon the Bank of England base rate would also be a variable rate, but changing as the BoE change their base rate.

    Bear in mind interest rates are at historically low levels and can perhaps be expected to gradually rise over the coming months\years. This can could mean you pay more or less on a variable rate than a fixed rate.
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