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Santander to hike SVR by 0.5%

Santander 480

Santander has written to customers informing them that it intends to increase the standard variable rate from 4.24 per cent to 4.74 per cent from 3 October.

The lender is also informing customers that the SVR cap margin – the maximum amount above the Bank of England base rate that it can charge – will rise from 3.75 per cent to 4.99 per cent from 24 September.

A Santander spokeswoman says: “This move is prompted by several factors, most notably the fact that for the last three years the amount it costs us to provide mortgages and the rates we offer our savings customers have been increasing despite the base rate remaining static. Indeed, for some time the correlation between base rate and mortgage and savings rates has been weakening. Additionally, the cost of running a bank in the UK has increased dramatically through a combination of increased liquidity, capital and funding requirements.

“Our analysis shows that our SVR mortgage holders will see an average increase of £26 per month for a £100,000 mortgage. We will consider all particular customer circumstances that might lead to financial difficulties as a result of this change. We will work with our customers on an individual basis and we have developed a programme to help them manage any impacts consisting of payment holidays, waiving charges or even resetting mortgages as appropriate.”


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There are 14 comments at the moment, we would love to hear your opinion too.

  1. “A Santander spokeswoman says: “This move is prompted by several factors”

    Just one factor – Unmitigated GREED.

  2. All that and great customer service too!

  3. Jolly Green Giant 22nd August 2012 at 12:42 pm

    Couldn’t have anything to do with the fact that more people coming to the end of a mortgage deal with Abbey/Santander are now less likely to just stick with the SVR (which is currently lower than most of their deals) but be pursuaded to choose a new deal with a £1000 arrangement fee and penalties if they pay off during the term?

    Or am i just being a little scepticle.

    No, must just be me, because we all know that banks are only looking after our best interests!!

  4. And lets not forget the ability to charge a max margin of approx 5% yes 5%!!!!! over base !!!

    Con men !!

  5. I think its only natural that Santander have increased their SVR rates.

    Surely Santander customers could see this coming after other lenders increased their svr at the start of the year.

    People need to be realistic given the current financial climate and the fantastic savings rates that Sanatnder consistently offer they need to cover their costs somehow.

  6. They’re just right! I fully support the increase.

  7. People need to be realistic about this rise. Santander are not the first bank to increase their SVR this year, and are unlikely to be the last. The massive increase in funding such mortgages means they either cut jobs or increase SVR. People seem to forget the fantastic rates Santander offer their savings customers. Santander are one of the few banks not to take money from the tax payer. Join the real world people..

  8. Roman Duzinkewycz 22nd August 2012 at 2:08 pm

    I have been offered, some 10 days ago, a new fixed rate mortgage from Santander and we have been wondering how long it takes for the paperwork to come through – this after being chased by them for a decision which we finally went with. Reading this and, speaking to them on the phone (which my wife is doing right now by the way), they all of a sudden have no record of any of these conversations (of which there were several believe me), have no record of any paper work being arranged. I do hope the FSA read this and finally get to realise how these people really do not ‘Treat Customers Fairly’ and indeed, have no idea what this actually means – stop letting these banks get away with murder and,as always, it’s the man in the street that suffers financially – disgraceful way of trying to carry on and ripping people off. I feel a complaint welling up inside me.

  9. Spot the obvious mistake that they mean £41.66 as the interest on 100,000 is £500 a year if there is a 0.5% increase.

    Cannot believe that a lender is doing this – I think you call it captive market as there are an awful lot of individuals cannot remortgage due to the changing mortgage market

  10. 22nd August 2012 at 7:05 pm

    AMAZING!!!! The good old banks ripping us off AGAIN!!! while our pathetic government stands by and watches. I will do my best to change my mortgage, Santander can sod off back to Spain were they can rot in there economic pot of misery!!

  11. Skipton did this in Feb 2010, increasing SVR from 3.5% to 4.95%.

    UK has £1.24 trillion of mortgage debt. Santander has 17% of that in market share.

    Several hundred thousand borrowers with an average loan size of £108,000, hit with a 0.5% rate increase should raise Santanders income by about £600,000 million per annum.

    The unethical part of the story, is that the increase will affect those low equity trapped borrwers who are unable to remortgage away.

    Treating customers fairly again, what a scum. industry banking is.

  12. The Government does one thing and injects cash and the banks do another thing rape the cash and screw the customers, I like the fact that the spokesperson for these banks say “several factors” it’s one factor “boardroom greed”

  13. RE: Anon @ 1.48pm on 22/08/12.
    You sound like the CEO of Santander so no wonder you are anonymous. Santander were already at the top end of SVR’s prior to this hike and should be ashamed of their blatant profiteering at the expense of those with high LTV’s.
    As for not taking money from the taxman – have you forgot about the recent massive bailout given to Spanish banks from the Eurozone only a matter of a few weeks ago?? Without this Spain and Santander would be doing well to conduct any business going forward.
    As a result of the higher SVR resulting in greater profits the CEO and other bosses will be able to reward themselves with much biggger bonuses next year- lets all celebrate that eh????

  14. Michael (which, incidentally, like James, is just as anonymous as “anonymous”), as we are picking up factual errors in the rants this afternoon, and you appear to have made one (up), then you may like to know that a) Santander UK are completely ring fenced from Santander Group and were not bailed out in the UK and b) Santander Group itself received no bail out, from ECB, Spain or Uncle Tom Cobley. To suggest they would have gone pop is rather ridiculous.

    In fact, San UK actually participated in bailing out others by purchasing A&L and BBG, so as taxpayers maybe we should be grateful to them?

    I guess the main reason for that was they had bigger CT1 to call on, generated by bigger profits, generated by…oh..wait.. I guess that explains the rationale behind putting up the SVR.

    They still offer a bloody awful service mind you….

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