SVR... After fixed rate ends

jw2003

This is probably a simple one so apologies for my ignorance.

I have a 2 year fixed rate mortgage at 6.7%, my paperwork says when the fixed period ends we will revert to the SVR of 4.4%. Now forgive me for my ignorance but if interest rates rocket between now and then the SVR would surely increase, is that right? Would they need to let us know or would we be expected to "find out for ourselves"? Our Mortgage is for approx £83k and house value iro £130k (bought for £92k 12 months ago). Hopefully our equity will remain as such that we can shop around for a good deal but I'd like to be a little more clued up.

Thanks in advance

Wutang_2

Possibly a mortgage offer based on the SVR at the time, may well have changed.

MarkyMarkD

All mortgage offers will state the revert rate based on current rates. It will actually be whatever their SVR is when the fix ends, and they will tell you at the time, or you can ask them a few months earlier if that helps you to decide what to do.

jw2003

Thanks, that's what I was thinking but I just wondered why they would put 4.4% in black and white when things can and do change. Unless the base-rate shoots up hugely anything should be an improvement

flammable999

jw2003 wrote: »

This is probably a simple one so apologies for my ignorance.

I have a 2 year fixed rate mortgage at 6.7%, my paperwork says when the fixed period ends we will revert to the SVR of 4.4%. Now forgive me for my ignorance but if interest rates rocket between now and then the SVR would surely increase, is that right? Would they need to let us know or would we be expected to "find out for ourselves"? Our Mortgage is for approx £83k and house value iro £130k (bought for £92k 12 months ago). Hopefully our equity will remain as such that we can shop around for a good deal but I'd like to be a little more clued up.

Thanks in advance

dont worry I had the same fears because I vaguley rememebred my rate was going to change from 7.18 to 7.8 after fixed ends but i cudnt find my paperwork. got a copy of mortgage offer this week from lender and it said will change to a standard variable rate, CURRENTLY 7.8% ( the libor was 5.8 at the time )

I was under the impression that it was gonna be 7.8 no matter what but now I know it wont be, well not for a while hopefully

VIGILANT22

jw2003 wrote: »

Thanks, that's what I was thinking but I just wondered why they would put 4.4% in black and white when things can and do change. Unless the base-rate shoots up hugely anything should be an improvement

who is yr lender?

jw2003

VIGILANT22 wrote: »

who is yr lender?

It's with NatWest

beecher2

jw2003 wrote: »

house value iro £130k (bought for £92k 12 months ago).

Are you sure about these figures?

jw2003

beecher2 wrote: »

Are you sure about these figures?

Yeah - it was a repossession that needed a lot of work doing on it and they were after a no-chain quick sale, the amount we have spent doing it up would bring it inline with what the rest on the street cost but it's not mortgaged money so I don't count it

VIGILANT22

jw2003 wrote: »

It's with NatWest

Nat West SVR is currently 4% (3.5% above base)

MarkyMarkD

jw2003 wrote: »

Thanks, that's what I was thinking but I just wondered why they would put 4.4% in black and white when things can and do change. Unless the base-rate shoots up hugely anything should be an improvement

Because they've got (by law) to quote the revert rate as it would be if your fixed rate ended right now. It's not particularly helpful, but I suppose it helps you to see if their SVR is high or low compared to others (even though it might change by any amount).