Mortgage lenders raising their fixed rates and more price hikes expected
Tags: Remortgages, Residential mortgages
Quick Summary
Mortgage lenders across the UK are starting to increase fixed mortgage rates, with lenders warning that more mortgage price rises are likely in the coming days. Several major lenders, including HSBC, Nationwide Building Society and Coventry Building Society, have already raised rates as swap rates and funding costs increase following global economic uncertainty. Aaron Strutt of Trinity Financial said it “seems almost certain” more lenders will change pricing soon and advised borrowers looking for a mortgage or remortgage to consider securing a deal quickly. Rising funding costs mean lenders are adjusting pricing, and delaying a decision could leave borrowers facing higher mortgage rates if further increases are announced.
Mortgage lenders across the UK are increasing their rates and more rate rises are expected this week as global events push up borrowing costs.
Several major lenders, including HSBC, Halifax, TSB, Nationwide Building Society and Coventry Building Society, have already raised fixed mortgage rates. The increases follow rising swap rates, which lenders use to price fixed-rate mortgages.
Santander has also just emailed Trinity Financial's brokers to say all of its fixed rates are increasing by up to 0.24%. It's My First Mortgage: 10k deposit, fixed rate, was lowered a few days ago to just below 5%, but it is now increasing by 0.21%.
Aaron Strutt, product director at Trinity Financial, said: “It seems almost certain we are going to see a lot more rate changes over the coming days, so if you are on the hunt for a mortgage, it is worth locking into a new deal now.”
Rising oil prices and inflation concerns linked to the Middle East conflict have added uncertainty to financial markets, which is feeding into higher mortgage rates.
For borrowers looking to buy a home or remortgage, acting early could help secure a more competitive rate. Many lenders allow homeowners to lock in a remortgage rate up to four months before their current fixed deal ends, which can protect them from further increases.
While the Bank of England may still reduce the base rate later this year, in the short term, mortgage lenders are responding to higher funding costs, meaning borrowers could see more mortgage rate rises in the days ahead. One bank said these price hikes will be "painful" for many homeowners.
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The information contained within was correct at the time of publication but is subject to change.
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