Once your mortgage has come to the end of its deal period you'll be placed onto the current standard variable rate (SVR) as a First Direct customer. There are no products that you can apply for just on SVR as even the tracker mortgages track the Bank of England base rate rather than the First Direct mortgage rate.
The current standard variable rate for First Direct Mortgages is 3.69% which is is slightly higher than the industry average and 3.5% above the BOE base rate.
Although the lead rate from a First Direct mortage deal may look low it's actually the standard variable rate or SVR that's charged once your 2 or 3 year offer has completed which is probably the most important number to look at these days.
If your circumstances change between when you take out a product to when you may need to renew it several years later then you may not be in a position to get similar terms, especially if house prices have fallen and you are in negative equity or simply your loan to value percentage has increased. For example, if you lose your job or you have a child and one parent does not work any longer.
That's just the reason why lenders publish an APR because this takes into account the initial generally discounted rate as well as the SVR for the term of the mortgage loan.
Whilst the initial rates offered by First Direct are actually some of the best deals in the industry and market place you should perhaps consider not only the arrangement fees that are now charged by all lenders, the repayment penalties if you decide to pay off your loan or have to move house but also the standard variable rate you may have to pay if you don't remortgage once your deal period has completed.
Although you can't get a straight off standard variable rate deal from First Direct they do offer an offset mortgage at 3.59% variable which is lower than their SVR deal so it's wise to look at all the offers available before making your choice.
With so many products on the market it may be easy to choose the lowest headline rate but once you have added in arrangement fees and any additional charges the rates offered by all companies including First Direct may push up the actual cost of the mortgage. Therefore it may be prudent to either use a comparison website and certainly to get professional advice to help your decision making process.
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