NatWest raises rates again while Virgin Money lines up steep increases
NatWest is hiking rates across much of its residential and buy-to-let mortgage range for the fourth time this month, while Virgin Money is also pushing through sharp increases on selected products.
From tomorrow, 26 March, two-year fixed-rate purchase deals will rise by 15 basis points (bps). The only exception is at 85% loan-to-value (LTV), where the increase will be 10bps. The lowest two-year fixed purchase rate will be 4.47% at 60% LTV, with a £1,495 fee.
Five-year fixed rates are also moving up, by as much as 15bps. At 80% and 85% LTV, rises are smaller at 10 to 12bps. The cheapest five-year fixed purchase rate will start from 4.64% at 60% LTV, with a £1,495 fee.
The high street lender is also increasing two- and five-year fixed remortgage rates by 15bps. Two-year remortgage fixes will begin at 4.51% with a £1,495 fee, while five-year rates will start from 4.64%.
Tracker pricing is changing too, with all two-year purchase and remortgage tracker rates rising by 15bps.
For first-time buyers, two- and five-year remortgage rates at 85% and 90% LTV have increased by 10 to 15bps, as well as green purchase and remortgage products.
In buy-to-let, NatWest has lifted rates by 15bps across two- and five-year purchase and remortgage products. The lowest fixed-rate buy-to-let purchase deals are now 4.74% for two years and 4.83% for five years. Buy-to-let remortgage pricing starts from 4.16% fixed for two years, with a £3,999 fee.
Two- and five-year fixed further advance products are also increasing by 15bps.
“NatWest is the latest big bank to raise rates although these price hikes are not as big as the ones many of its competitors have made,” said Aaron Strutt (pictured right), product director at Trinity Financial.
“The most reasonable two-year fixes are priced around 4.5% at the moment although somehow TSB seems to still have a 4.29% two-year fix which I doubt will be available much longer. NatWest and RBS were offering many of the cheapest five-year fixes, but they are rising so the bank will have five-year fixes starting from 4.64%.
“Looking at the best buy mortgage tables any type of fixed rate priced around 4.5% is generally about as good as you are going to get now unless you are quick and get one of the remaining slightly cheaper deals from NatWest, Santander or TSB.
“More lenders also seem to be increasing their tracker rate margins, so trackers are not looking as competitively priced as they were a few days ago.”
Meanwhile, Virgin Money announced that it would increase mortgage rates across purchase, remortgage, buy-to-let and product transfer products.
For purchases, two-year fixed rates will be increased by up to 70bps, five-year fixed rates by up to 65bps and 10-year fixed rates by 60bps. Shared Ownership fixed rates will be increased by up to 70bps. Two-year tracker rates at 65% and 75% LTV with a £999 fee will be increased by 10bps.
For remortgages, two-year fixed rates will be increased by up to 65bps and five-year fixed rates by 60bps. The 75% LTV 10-year fixed-rate fee-saver will be increased by 55bps.
For BTL, two-year fixed rates will be increased by 75bps and five-year fixed rates by 65bps.
For product transfers, two-, three- and five-year fixed rates will be increased by up to 40bps, and 10-year fixed rates by 30bps. Two-year tracker rates at 65% and 75% LTV with a £999 fee will be increased by 10bps. BTL product transfer fixed rates will be increased by 50bps (two-year), up to 50bps (three-year) and 40bps (five-year).
“Virgin Money has been offering some of the best fixed rates and has not changed its rates much recently, but even so, a 0.70% price hike is probably the biggest one yet,” Strutt noted. “If anyone thinking about taking a Virgin Money mortgage holds off until tomorrow, they will end up paying significantly more.”
Aside from NatWest and Virgin Money, several other lenders also announced pricing changes on Wednesday.
TSB is increasing rates on remortgage products in its residential, buy-to-let and portfolio buy-to-let ranges from tomorrow. Metro said it would withdraw products later today ahead of increases across residential and buy-to-let.
Nottingham said it was making further rises across its ranges, while Coventry said it would increase offset and interest-only fixed rates for existing customers on Friday.
Aldermore also announced changes late on Tuesday, including withdrawing product switch rates from 5pm today, and launching new core rates tomorrow. Accord said it would raise some rates by as much as 46bps.
“It will be interesting to see when rates start dipping again and how slowly they come down,” Strutt said. “Swaps are down a lot since the peak, but the rises keep on coming.”
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