The Standard Variable Rate, or SVR, is the rate of interest upon which most of a lender’s products will be based. It is usually set at a certain percentage above the Bank of England base rate, changing to correspond with the base rate. When these changes occur, the lender is not obliged to change their own rate either in line with the base rate, or even at all. This means that if the base rate falls, the lender can choose not to pass on this fall or to decrease their rates by a smaller percentage. The same will be true of any rise in the base rate.

Most mortgage deals revert to the Standard Variable rate after an introductory period. Anyone on a standard rate should be able to move their mortgage without any danger of redemption penalties, but you must check your deal to see if this is the case. As the bulk of all borrowers will be paying the Standard Variable Rate, the market is very competitive.