Santander to increase its Standard Variable Rate by 0.50%

Santander UK intends to increase its Standard Variable Rate from 4.24% to 4.74% from 3 October 2012.

There will also be an increase in the lender's SVR cap margin – the maximum amount above the Bank of England base rate that it can charge – from 3.75% to 4.99% from 24 September.

Santander said its competitors increased their SVRs by similar amounts earlier this year, reflecting the same market dynamics. In the past few months Halifax, Co-operative Bank, Bank of Ireland and Yorkshire and Clydesdale Bank have increased their SVRs.

Santander's analysis shows that its SVR mortgage holders will see an average increase of £26 per month for a £100,000 mortgage.

Santander now joins the list of lenders to hike its SVR, despite the fact the Bank of England base rate has remained unchanged since March 2009.

A Santander customer on its SVR rate with a £150,000 25-year repayment mortgage will see their payments increase by £42.54 a month; a significant amount for the many households who will be impacted by this.

Anyone affected by this or who is concerned their mortgage lender may join the SVR-hiking pack should consider remortgaging onto another deal if possible.

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Speak to an independent mortgage broker like myself , if you are unsure of the best option as they will explain what is available to you and help to make the best decision for your situation.

As always thanks for your attention.