Nationwide Building Society’s mortgage lender has raised interest rates for homeowners by up to 0.3 percent on fixed rates across their range.
Its two-year remortgage rate will now start from 4.45 percent with a £1,499 fee, and the five-year equivalent deal will start from 3.94 percent . Both are at 60 percent loan to value.
First-time buyer deals at 90 percent loan to value are now from five percent for a two-year fixed rate or 4.55 percent over five-years, both with a £999 fee. Its five-year 95 percent loan to value fee-free first-time buyer deal is at 5.14 percent.
The increases will take effect from Friday, February 2.
In an email to customers, they wrote: “We are increasing selected products by up to 0.30 percent. This includes rates across our New Business, Additional Borrowing, and Existing Customers Moving Home product range.
“There will be no changes to switcher rates as part of this change.
“Remember you can reserve a product without needing to submit a full mortgage application (FMA). You need to submit a decision in principle, click on reserve product, and follow the prompts.”
Existing products must be reserved by today at 8 pm, Thursday, January 1.
The increase follows a number of lenders raising selected fixed rates over the past week, including Barclays, Coventry Building Society and Co-operative Bank.
This is despite the Bank of England announcing that it is holding the main Bank interest rate at 5.25 percent today.
For more information, customers can visit the Nationwide website.
Last week Nationwide was sitting at the top of the best-buy tables with reductions of up to 0.81 percentage points, said brokers.
Its new mortgage rates started at 3.84 percent– the lender’s lowest rate for eight months. However, brokers were sceptical how long they could afford to keep rates this low.
Speaking to the Newspage news agency, Lewis Shaw, Owner and Mortgage Expert at Shaw Financial Services explained that when Nationwide announced their reduced rates on 23rd January, he knew it wouldn’t last for long.
He said: “It was blindingly obvious they wouldn’t be able to sustain the very low rates with the upward direction of swap rates.
“This is a stark reminder that, as much as we hope things are on an even keel, don’t take anything for granted, and certainly don’t sit on your hands if you’re due to renew.”
Justin Moy, Managing Director at EHF Mortgages said: “Given Nationwide was late to the table of rate cuts in January, it’s surprising to see them react so quickly in February, but this does show that the cost of funds is increasing and lenders are having to readjust their rates with little notice.
“Nationwide does allow brokers to reserve deals in advance, which is an important benefit, especially in a market where rates are increasing. No change for existing clients looking for a new deal, but those looking to refinance or purchase will be affected.”
The Bank of England has held interest rates at 5.25 percent but indicated it is edging towards cutting borrowing costs.
