The West Brom is the first lender in the market to align its approach for mortgage customers on its standard variable rate (SVR) to that of new mortgage customers.

The Society’s SVR will now be determined by loan to value (LTV) percentage and will apply to all owner-occupier mortgage customers reaching the end of their initial product period.

The new rates, which are split into three tiers, will enable existing customers to benefit from any increase to the value of their home* or reductions made to their mortgage balance.

It is expected that 90% of the West Brom’s owner-occupier mortgage members on its SVR will see savings on their current interest rates, with the majority seeing a reduction of 0.75% to 4.49%, nearly 17% lower than the average reversion rate across the industry.** No members currently on SVR will see an increase in their rate due to this change.

Jonathan Westhoff, Chief Executive of the West Brom, said: “As a mutual organisation, our purpose is to support the financial wellbeing of our members and enable as many people as possible to own their own home.

“For new mortgages, one of the key determinants of market pricing is the amount of the loan compared to the value of their home. We want to apply the same approach for members who choose to revert to a standard variable rate at the end of their initial product term.

“Not only does this align with our purpose, but it’s another way we’re helping our customers to manage through the cost of living challenges we currently face.”

*As measured by UK House Price Index.

**Based on standard variable rates published in Moneyfacts® Treasury Report: UK Mortgage Trends, September 2022.