Lenders announce mortgage hikes

Published:
29 September 2008
Topic:
News,Money,Mortgages

Mortgage rate hikes have been introduced by three lenders, bringing the trend of falls in the cost of home loans to an end.

HSBC, Barclays' lending arm the Woolwich and internet and telephone bank first direct all increased their rates, signalling an end to the longest period of falling mortgage rates since the beginning of the credit crunch. Other lenders are now expected to follow suit in the coming days.

A steady decline of rates since July had helped reduce the average cost of a two-year fixed-rate mortgage to its pre-credit crunch level, as lenders competed for business.

HSBC has increased its fixed-rate deals for borrowers with just a 10% deposit by 0.3% and is introducing a new loan-to-value tier of 75% on its fixed rate range as well as cutting rates on these deals by 0.2%.

The Woolwich is increasing its fixed-rate mortgage deals by up to 0.35%, while tracker ones are rising by 0.05%.

First direct is increasing its two-year fixed-rate loans by up to 0.3%.

Copyright © PA Business 2008

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