A variable rate mortgage is a type of home loan where the interest rate can fluctuate over time. Unlike a fixed rate mortgage, where the interest rate remains constant for the entire loan term, a variable rate mortgage is subject to changes based on various factors, such as market conditions or an external benchmark rate like the Bank of England base rate.
With a variable rate mortgage, your monthly mortgage payments can increase or decrease as the interest rate changes. This means that the amount you pay towards interest and principal can vary throughout the life of the loan. The specific rate adjustments and frequency of changes will depend on the terms of the mortgage agreement.