As the name suggests, the monthly payment can fluctuate in line with changes in the interest rate charged. The lender sets their own particular variable rate which is generally between 1 & 2% over Bank of England Base Rate. However, as the lender is in control of these rates, they are under no obligation to pass on any base rate cuts to their borrowers.

Unless you have chosen a mortgage product that commits you to the lender beyond the end of any special introductory rate or received a cashback with your mortgage then there are usually no redemption penalties whilst a borrower is on SVR and you are free to remortgage elsewhere to a better rate without being financially penalised by the current lender.