Variable rates trade certainty for flexibility. Your lender’s SVR can move, affecting your payments; discount deals sit at a margin below SVR for a period.
How it works
SVR is set by the lender and can change at their discretion (often influenced by the base rate). Discount mortgages track SVR minus a discount (e.g., SVR –1%) for 2–3 years before reverting.
Benefits
Often fewer or no ERCs, generous overpayment terms, potential savings if SVR falls, useful if you plan to remortgage/move soon.
Risks
Unpredictable payments, potentially higher long‑run cost, and lender‑controlled adjustments.
Example
£180k, 25 years @ 6% ≈ £1,166/m; at 7% ≈ £1,272/m; at 5% ≈ £1,052/m.
Alternatives
Fixed or tracker products, or capped‑rate deals if available.
Why Everest Mortgages
We weigh flexibility vs certainty, identify competitive SVRs, and plan remortgages to avoid costly reversion rates.
Final thoughts
Variable products suit borrowers who value freedom and can handle payment swings.
Compare variable vs fixed with a free review—Everest‑Mortgages.co.uk.
