Homeowners that have their mortgage deal end and do not remortgage are moved to their lender’s standard variable rate or SVR. The lender’s SVR could actually help the homeowner if it is a lower interest rate than what the homeowner was used to pay on their mortgage term. However, the SVR can be risky to a household budget that cannot handle a fluctuating rise in their interest rate. That is why most homeowners will seek a fixed interest rate remortgage so that they lock in a low rate rather than facing a possible rate increase.

Considering that most homeowners would of course prefer to not pay more than necessary on their mortgage, a remortgage is a good consideration. Usually a remortgage has lower interest rates available than SVRs and currently the difference can be dramatic offering major savings.

According to a recent survey report, more than one quarter of mortgage holders are on a SVR. Habito polled 2,000 mortgage holding homeowners and found 27% were on a SVR. The reason so many are connected to a SVR ranged from not realizing their deal had been moved, not realizing they could find a cheaper deal, and some were not keen on going through the process to gain a remortgage thus putting it off and instead paying out money they could be saving.

In an analysis it was determined that the average lowest two year fixed rate remortgage offered an interest rate of 1.26% while the average SVR from the top six lenders was 3.53%. This rate of course could increase with little to know warning, while a fixed rate remortgage is set for the entire term of the deal.

Experts encourage homeowners to shop online to discover what savings could be available. Many remortgage brokers and lenders will have the available service of obtaining a quick quote. After a few questions are answered, the homeowner will obtain information on possible remortgages. It would help determine the savings and would likely kick in the motivation to make the effort to lock in a deal and save at a time when financial security would be highly welcomed.