Lenders capitalising on the standard variable rate Monday, 23rd November 2009

On average,Standard Rate Mortgage Deals are now charging 4.7%, a reduction of just 0.98% in twelve months compared to a 2.5% fall in Bank Base Rate over the same period.

What this means is that some lenders have increased their profit margins on SVR deals by not passing on the full Base Rate cuts or subsequently increasing their rates.

Borrowers must consider that lenders are free to price their SVR as they please, and therefore an SVR deal might not be the best way to get the most benefit from the low Base Rate environment.

It might be time therefore to look at remortgaging onto some attractive fixed rates.

If you have built up at least 20% equity in their home, it is likely that you will be able to find a better rate on a two or three year three-year fixed deal, at which point the only real drawback from fixing is the arrangement fee, which can be anything up to £1000. If you do not have as much equity then you are in a more difficult position.

Talk to a mortgage broker for the best all round advice.