Interest rate question .. Will our mortgage go up?

[bytheMoonlight]

We are currently on SVR rate of about 6.5% if interest rates rise what are the chances that our interest rate will rise? Will it affect everyone or just those that are benefiting from the low intrest rate atm?

Is it worth phoning our mortgage company and asking them?

If interest rates go up then it is likely that over time lenders svr's will go up too.

However there is no suggestion as to when this will happen.. Small question is there no way you can move from your svr or are you stuck there for some reason as 6.5% is quite alot to be paying atm.

I know it is.

Wish we could move to another rate but we are currently in a debt management plan so our credit rating is poor (but at least we are paying the debt off now) and we lost a lot of equity in our house due to buying at peak time (2007),paying a high price and then house prices fell.

So poor credit rating and low equity makes moving impossible

Try to move to a fix if you are worried about rates going up - we have a 5 year fix at 4.5 % with Coventry Building Society but you need at least 10% equity

We would need to get the house valued to work out the equity, we had 10% when we bought but I have no idea what house prices are doing now

Your mortgage document should describe what your SVR is based on usually a certain percent either Libbor (the rate which banks lend each other ) or bank of england.
This will let you know what will make your mortgage payments change.

Can you not move onto a fixed rate with your current provider? If interest rates go up you can be sure that mortgage rates will follow pretty quickly. I'm sure your mortgage provider won't want to see you get into more debt.

You're already paying a lot - we're on a fixed rate of 3.99% for 2 years!

You will need at least 10% equity to fix a rate, it's possible your current lender would be willing to do something without that but unlikely. First step is to get a valuation on your property to get an idea from there. With 10% equity the rate you could get wouldn't be much different to the rate you are on at the moment, however obviously the benefit is that if rates increase then yours won't. Due to your debt management plan you are unlikely to find a lender who you could transfer your mortgage to at the moment even with equity. Just be aware that most banks just have SVR based on a 'bank managed rate' so they can alter it at any time, not just when interest rates change. 6.5% is highest I've heard of, most use between 2 and 5%, so maybe check that with your lender? Xxx

Are you sure you are on the SVR? 6.5% sounds vv high! We are on a SVR of 3% (bought in 2006).

Who is your mortgage with?

Phone and ask how they calculate their SVR.