Fixed mortgage rates edging up as Barclays, NatWest and HSBC raise prices
Banks and building societies have been raising the price of their mortgages due to the funding cost increases sparked by the Budget.
HSBC, Barclays, Nationwide Building Society, Santander, and TSB are the latest big lenders to announce they are raising their mortgage rates by around 0.3%. This is despite the Bank of England base rate dropping from 5% to 4.75%.
Are lenders still offering sub-4% mortgages?
Most sub-4% mortgages have been withdrawn, although many are still priced around 4.25%.
NatWest for Intermediaries has launched new and slightly higher rates for borrowers buying a home. The bank offers a sub-4.25% two-year fix and a sub-4.15% five-year fix. Applicants will need a 40% deposit to qualify. There are £1,495 arrangement fees, and both rates are available for mortgages up to £2 million.
HSBC for Intermediaries offers some of the most competitively priced mortgages, with two-year fixes starting from around 4.30% and five-year fixes starting from 4.15%. Both rates are available to borrowers purchasing a property, have £999 arrangement fees, and applicants need a 40% deposit to qualify. The maximum loan size is £2 million.
Have lower deposit mortgage rates been increasing?
Most lenders tend to raise the cost of their lowest rates, often for those with larger deposits. Some first-time buyer rates have been going up, but not always by a considerable amount.
Figures from data firm Moneyfacts show the average mortgage rate is available for 17 days, down from 21 days a month ago. The average two-year tracker variable mortgage rose slightly to 5.71%, although some rates track the base rate plus a margin of 0.2%.
Aaron Strutt, product director at Trinity Financial, says: "There is a fair chance the recent fixed rate increases could slow down as many have gone up by around 0.3%, which is in line with the recent rise in the cost of funding.
"The Bank of England base rate could take longer to fall from 4.75% after forecasts that inflation will creep higher. The next Bank of England base rate decision by the Monetary Policy Committee will be announced on Thursday, December 19, although it seems unlikely we will see a third base rate reduction this year."
Call Trinity Financial on 020 7016 0790 to secure a mortgage, book a consultation, or complete our mortgage questionnaire.
The information contained within was correct at the time of publication but is subject to change.
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