NatWest and Barclays are the latest providers to increase mortgages rates – signalling that lenders are preparing for a base rate hike from the Bank o
NatWest and Barclays are the latest providers to increase mortgages rates – signalling that lenders are preparing for a base rate hike from the Bank of England.
NatWest has upped residential rates by up to 0.90%, though most are smaller increases at around 0.10%, while Barclays has increased 2-year fixes by up to 0.20%.
Since last week there have been increases from lenders including Nationwide, Skipton, West Brom, TSB and Atom Bank.
Mark Bullard, head of sales at NatWest, said: “Having reviewed our product portfolio in line with the prevailing market conditions, we are introducing changes to our mortgage rates that include a number of rate increases on our residential deals and a rate reduction for a buy-to-let purchase mortgage.
“Swap rates have risen recently, on the expectation that interest rates will begin to rise in the near future, which has increased the cost of funding.”
Bank of England Governor Mark Carney signalled the base rate rising in the “relatively near term” last week.
The next time Monetary Policy Committee meets will be on Friday 13 September.
NatWest’s biggest increases were to 5-year fixed rate remortgages.
Those products with a £995 fee now stand at 2.59% (+0.67%) to 60% LTV, 2.73% (+0.63%) to 70% LTV, 3.39% (+0.78%) to 75% LTV, 3.55% (+0.72%) to 80% LTV, 3.58% (+0.90%) to 85% LTV and 3.89% (+0.40%) to 90% LTV.
Fee free options been increased by a similar amount.
NatWest has made smaller increases to first-time buyer products as well as 2 and 5-year purchase mortgages and shared ownership products.
It also increased a buy-to-let 5-year fix purchase product by to 2.59% (+0.09%) to 60% LTV with a £995 product fee.
Following increases Barclays is now offering a 2-year fix to 85% LTV with a £999 fee at 1.49% (+20%) for purchase and remortgage.
Also available is a Help to Buy equity loan product at 1.39% (+0.10%) to 75% LTV and a Help to Buy London 2-year fix at 1.35% (+0.10%) to 55% LTV (both products come to 95% LTV with the equity loan).
David Hollingworth, director of communications at London & Country, said: “We have been seeing a raft of lenders putting their rates up in the last week.
“Not necessarily by that magnitude of 0.90% but that may be NatWest easing off volumes.
“It would suggest there’s a bit of a squeeze on lender margin that’s probably stemming from market expectation that the base rate is going to climb.”