Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Major Lenders Raise Mortgage Rates Following Swap Rate Surge
Several UK lenders have increased mortgage rates in response to a recent rise in swap rates, according to a report by Mortgage Solutions. The changes affect a range of residential and buy-to-let (BTL) mortgage products, with new pricing announced by Nationwide, HSBC, Accord, TSB, and Virgin Money.
Chatham Financial reported that the two-year swap rate reached 4.258% as of 22 July, up from 3.993% last month. The five-year swap rate also rose from 4.034% to 4.316%. These increases have been linked to the escalating conflict between the US and Iran and the closure of the Strait of Hormuz, which has pushed oil prices to $100 for the first time since May.
Nationwide, HSBC, and Accord Announce Increases
Nationwide has raised rates across its mortgage range for existing borrowers. For example, the two-year fixed additional borrowing product at 60% loan to value (LTV) with a £999 fee increased from 4.37% to 4.6%, while the 75% LTV deal rose from 4.46% to 4.68%. Pricing also increased at the 80-90% LTV tiers and across fee-free five-year fixed options. Nationwide also raised product switching rates and selected three- and five-year options.
HSBC announced its second rate rise in a week, with changes effective from 27 July. The increases will affect UK residential first-time buyers, homemovers, remortgage, switching, borrowing more, and rates for energy-efficient properties. HSBC will also increase BTL purchase and remortgage rates, as well as international residential and BTL deals.
Accord has increased fixed residential new business rates up to 90% LTV by 0.2%. There are no changes to pricing at 95% LTV, its £5k Deposit Mortgage, or tracker rates. For BTL new business, all rates have risen by 0.1%.
TSB and Virgin Money Adjust Rates
TSB has lifted two-year fixed residential purchase and remortgage rates by up to 0.2% as of 24 July. Purchase pricing now starts at 4.59% for a deal at 60% LTV with a £995 fee, or 4.84% with no fee, rising to 5.49% at 90-95% LTV. Similar increases have been made to two- and five-year fixed BTL remortgage rates up to 60% LTV.
Virgin Money has adjusted product transfer rates, with residential pricing increasing by up to 0.23% and BTL rates by up to 0.15%.
These changes are relevant for letting agents and inventory clerks, as higher mortgage rates may influence landlord and tenant activity in the UK property market.
Source: Mortgage Solutions