The UK’s biggest lender is upping several of its fixed rates for first time buyers and movers by 0.2 per cent while increasing its three-year fixed rate remortgage products by up to 0.15 per cent.
Santander, HSBC, TSB and Leeds Building Society also all announced they were increasing costs on their home loan deals last week.
They have been increasing despite expectations that there will be an interest rate cut when the Bank’s Monetary Policy Committee (MPC) meets in early February.
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Read More“Unfortunately, this hasn’t fed through into market pricing. An important moment for the market will come on 26 March, with the release of the Office for Budget Responsibility report. This report will play a key role in shaping perceptions of the government’s fiscal credibility.
Not only does this spark bad news for homeowners, but it will also be a blow for the Chancellor Rachel Reeves and the Government who promised to ease bill pressures for households across the country.
David Hollingworth of L&C Mortgages said: “Market rates shifted in the opening weeks of the year as inflationary pressure saw the number of expected rate cuts being questioned. That saw a flurry of increases, albeit relatively small, in fixed rates from a range of lenders.
“These changes may well have a knock on [effect] for others as it will push them higher up the best-buy tables and may apply increasing pressure on service as well as pricing.”
Despite many lenders upping rates, several have also cut at the same time.
Aaron Strutt of brokers Trinity Financial said: “It is quite surprising that many more of the lenders have not pushed their rates up based on the economic uncertainty we have had recently. We still have access to rates like Nationwide’s 4.17 per cent two-year fix and NatWest’s 4.07 per cent five-year fix.”
Consulting a mortgage broker is highly recommended, as they can provide tailored advice and access a wider range of products than those available directly to consumers. Brokers can also help borrowers decide whether to secure a rate now and move onto a new rate should the market improve.
Acting decisively will provide peace of mind and stability in what remains a highly uncertain environment.
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