Two thirds (65%) of UK mortgage holders are unaware that standard variable rates are poor value compare to lenders’ fixed rates, research from Trussle has found.
What is more nearly half (48%) of UK mortgage holders don’t know when their fixed rate period is coming to an end and a quarter (24%) don’t know what SVR stands for.
Ishaan Malhi, chief executive and founder of Trussle said: “Borrowers are being put at a huge disadvantage by not understanding the implications of lapsing onto their lender’s Standard Variable Rate. This costs UK homeowners an alarming £10bn a year in interest payments.
“The industry, its regulators, and the UK government can address these challenges by working together.
“Potential solutions could be to agree a reasonable upper limit on SVRs, and a system where lenders are not only obliged to warn their mortgage customers well in advance of their fixed rate coming to an end, but also to confirm receipt of this notification.”