The standard variable rate
The standard variable rate is the lender’s default rate — what you roll onto when an introductory deal ends. It’s set at the lender’s discretion and is historically uncompetitive, which is why escaping it is a major driver of remortgaging.
What the SVR is
The SVR is the lender’s own default interest rate, applied once your fixed, tracker or discounted period expires. It isn’t tied to the base rate by any fixed margin — the lender can change it largely at its discretion, and it’s usually well above the deals on offer to new borrowers.
Loans on the SVR typically have no early repayment charges, so you’re free to leave at any time — which is exactly what most borrowers should do.
Why it costs you
Because the SVR is so often uncompetitive, sitting on it can add hundreds of pounds a month versus a fresh fixed or tracker rate. Lenders rely on inertia; the cost of not acting is real.
How contractors escape it
The fix is timing. Reviewing your deal three to six months before it ends lets us line up a new rate to start the moment your current one expires — so you never touch the SVR. Many contractors also find their original lender won’t offer competitive retention rates once they’ve gone independent, making a specialist remortgage the better route.
- Diarise your fixed-rate end date.
- Start the remortgage three to six months ahead.
- Switch to a lender that reads your contract income properly.
Standard variable rate, answered
Is the SVR linked to the Bank of England base rate?+
Not by a fixed margin. Lenders may move the SVR when the base rate changes, but they set it at their discretion — which is why it behaves differently from a tracker.
Can I leave the SVR at any time?+
Usually yes — SVR loans typically carry no early repayment charges. That makes remortgaging away straightforward once you have a better deal lined up.
How much could I save by leaving the SVR?+
It varies, but the gap between an SVR and a competitive new deal is often substantial — frequently hundreds of pounds a month. A quick review shows your specific saving.