More than 800 fixed-rate mortgage deals have disappeared from the market in a week, according to data firm Moneyfacts. The majority of those are residential, with some buy-to-let loans also pulled. Home Loan Deals As Fixed Mortgage Rates Rise.
Britain’s biggest building society Nationwide increased its two-year and five-year rates yesterday. That hike could cost first-time buyers thousands of pounds extra a year on their repayments. Home Loan Deals As Fixed Mortgage Rates Rise.
1. Nationwide
Nationwide has increased the cost of its fixed rate mortgages after higher than expected inflation figures prompted expectations that UK interest rates will rise. This has pushed swap rates up, which feed into mortgage pricing.
The building society has increased rates on its two, three and five-year fixed and tracker new business and switcher mortgages. It has also cut its shared equity mortgages, which allow people with a low deposit to borrow up to 100 per cent of their property’s value.
The move comes after a warning that homeowners on tracker mortgages could face spiralling repayments if they see their current deal come to an end and fail to secure a new one. Brokers John Charcol and Nicholas Mendes have both said borrowers who are nearing the end of their fixed term should speak to a whole of market broker as soon as possible.
2. TSB
Mortgage lenders are increasing the cost of fixed-rate deals at a frantic pace as inflation continues to accelerate and forecasters predict that rates could rise more quickly than expected. The average two-year fix is now PS35 a month more expensive than it was just four days ago, according to rate-tracking data firm Moneyfacts.
Permanent TSB has pulled out of a planned purchase of some EUR100 million worth of performing home loans that originated in the US-based GE Capital portfolio sold to Irish lender Pepper four years ago.
Santander made changes over the weekend, while TSB withdrew each of its 10-year fixed-rate deals connected Friday pinch only a few hours notice. Coventry building nine and LiveMore Capital are also raising their rates. Other lenders have increased rates on their residential purchase and product transfer offers.
3. Santander
In a note sent to brokers, the lender said it was temporarily withdrawing its two, three and five-year fixed mortgage products at 60 per cent and 85 per cent loan to value (LTV) – which will see rates rise by 0.09 percentage points.
Rates are rising in the UK as inflation continues to outpace wages and potential homebuyers struggle to afford the cost of repaying their loans.
This is a major concern for banks relying on these customers to drive profits. However, Santander is one of the few lenders that could withstand the pressure and reprice its mortgages quickly without hurting customers.
4. HSBC
This will hit homeowners who remortgage and first-time buyers trying to get a new home loan.
Amid uncertainty over where interest rates are heading the number of residential mortgage deals available has fallen, with just 4,686 on offer by Monday according to financial data analyst Moneyfacts.
This is a blow for the 1.8million homeowners who have cheap ‘fixed’ rate mortgages due to expire over the next year. They face paying thousands of pounds more a year as lenders reassess their offers. The higher costs will also hurt first-time buyers who are unable to access the best products.
5. Virgin Money
Virgin Money provides personal financial services intended to make the whole banking experience feel a lot more comfortable. The Company offers savings, loans and credit card services through its subsidiaries in Australia, South Africa and the United Kingdom. Virgin Money serves individuals, SMEs, commercial and corporate clients.
Mortgage market turmoil is prompting thousands of homeowners to face even higher annual bills, as lenders hike rates and withdraw deals. The average two-year fixed rate deal bought today is PS68 a month more expensive than it was just a few weeks ago, according to data from Moneyfacts.
Virgin Money has increased its residential standard variable revert rate and selected product transfer fixed rates following increases in the Bank of England base rate of 0.25% on 23 March and 11 May. The digital bank also raised its buy-to-let revert rate needs read more hear.
