Over the last year, an increasing number of people have chosen to stay on SVRs rather than remortgage when their existing deals came to an end.
However, following recent SVR hikes by lenders, including Skipton Building Society, the comparison website said most fixed-rate deals were now a cheaper option.
Hannah-Mercedes Skenfield, mortgages channel manager at Moneysupermarket, said that the majority of SVR deals do not compete with the top fixed-rate deals even after taking the arrangement fee into consideration.
She added: “As SVRs have increased and rates for new borrowers have been falling, we have seen an increase in the availability of mortgages, even at higher LTVs, so switching is a better option.”
Research from the Bank of England backed up Moneysupermarket’s claims, when it revealed that fixed-rate mortgage deals fell to record lows in January.
Last month, two-year fixed-rate deals fell to an average of 3.97%, a level last seen in July 2003, while the cost of a five-year fixed-rate dropped by 0.12% to 5.55%.
However, Darren Cohen, mortgage consultant at LRG, said clients were reluctant to remortgage while the Bank base rate was so low.
He added: “A lot of borrowers who are sitting on SVRs would probably be better off if they remortgaged, but some of them will not be able to. The best rates are only available to those with a lot of equity. There needs to be an improvement in the number of deals available to people with small deposits.”
David Sheppard, managing director of Perception Finance, said people should only move to a fixed-rate deal if their SVR deals are too expensive and they have enough equity.
He added: “The market has changed so much that those who decided against moving last year should revisit it now, because it is certainly possible that they could get another deal.”
