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More than a million face SVR rise

More than a million face SVR rise

Category: Mortgages

Updated: 01/05/2012
First Published: 01/05/2012

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

More than a million people face the prospect of higher mortgage bills, as a number of lenders have increased their standard variable rates (SVRs).

Bank of Ireland, Clydesdale and Yorkshire Banks, Co-operative Bank, Halifax and Royal Bank of Scotland/NatWest all increased their SVRs today.

The bank with the most affected customers is Halifax, with around 850,000 customers hit by the 0.49% increase, with the SVR rising to 3.99%.

Estimates by Which? suggest that the upturn in SVRs could add £300 million to the UK 's mortgage bill over the next 12 months.

Seven in ten of mortgage-holders are concerned about an increase in interest rates, figures show, while a worrying 14% say they are already struggling with repayments.

Three quarters of mortgage-holders said they would be affected if their repayments increased by £50 a month, with 41% saying they would need to cut back on regular spending, 20% would need to reduce savings and 11% would not have enough for essentials.

An increase of £100 a month would see 20% of mortgage-holders not having enough for daily essentials like food and 11% being unable to pay their mortgage.

Consumers also highlighted the emotional impact of increases in mortgage repayments, describing them as 'devastating' and 'a disaster'.

"Our advice to anyone struggling with their mortgage repayments is speak to your lender straight away," Which? chief executive, Peter Vicary-Smith said.

"It is encouraging that a third of people we spoke to had approached their lender but worryingly in one in five cases, they said their lenders offered no help at all. This is just not good enough and we want to see banks do more to help their customers who are struggling."

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