Lenders set to raise mortgage rates
Saturday 03 March 2012
Homeowners are set to suffer rising interest rates as two mortgage lenders put rates up.
RBS-Natwest is pushing up rates on two of its products by 0.25%, while Halifax is expected to raise its standard variable rate tomorrow.
The hikes in cost come despite the Bank of England maintaining the base rate at a historic 0.5% low and are expected to raise concerns among thousands of homeowners who are already struggling to make ends meet.
An RBS spokesman today said its rises would apply to two of its products - the Offset and The One Account, and would affect around 200,000 customers.
He said: "Over the last year the cost of funds at which we need to borrow at to fund our mortgage commitments has risen considerably.
"We have absorbed the cost during this period but have now decided to pass on some of this increase, 0.25% to our Offset and The One Account customers.
"For the majority of our Offset and One Account customers their new rate will be 4%, the same as our standard variable rate."
The move comes amid speculation that Halifax is set to push its standard variable rate (SVR) up from 3.5% to 3.99% from May 1, thought to affect around 850,000 customers.
The hikes are apparently due to higher costs of funding a mortgage in the current economic climate.
They come as families are being squeezed harder than ever by rising costs of living.
Among these are record high prices for petrol, announced yesterday - with the average cost of a litre at 137.44p, according to the AA, while diesel is up to 144.67p a litre, another new record.
The RBS rise will take effect from May 1, the spokesman confirmed.
Marc Gander, founder of the Consumer Action Group, which provides free consumer help, said: "It's shocking, it's coming at a time when people need this thing least of all.
"This is a nice thank you gesture to all the lovely people who bailed them out."
He said although some banks had recorded losses at the end of last month - Lloyds revealed losses of £3.5 billion for 2011, while 82% state-owned RBS unveiled losses of £2 billion - most were doing well.
"Banks have never had it so good," Mr Gander said. "They are doing fabulously well and it amazes me that they can't decide to share some of the burden that the rest of us are sharing.
"If they are saying they have to pass on rising costs, why can't they pass some of the good times on as well as the bad times?"
He said he thought it likely that other lenders may follow the rises announced this weekend.
"They reckon their customers are like sheep, and they themselves are like sheep," he added.
"One takes the lead, and I am absolutely confident that the rest will see these guys get away with it so think they may as well follow."
A spokesman for Virgin Money, which took over Northern Rock on January 1 after buying it for £747 million, said it had no plans to change its standard variable rate (SVR).
Independent Partners: Get fee-free expert mortgage advice and find the right mortgage deal for you.
Simon Read: Readers think I should cough up and pay for a tradesman's travelling time
No television licence leads to debt woes after court fines add up
Mark Dampier: Small can be beautiful for those investors who think long term
Tax boost for social investment will unlock £500m
Five ways to make money on the internet
- 1 Hundreds arrested as Canadian police smash worldwide paedophile ring
- 2 Is this the scariest advert ever? Japanese tyre commercial comes with its own disclaimer and health warning
- 3 Sherlock series 3: Benedict Cumberbatch and Martin Freeman provide teasers for the biggest comeback in British television
- 4 A forgotten episode in Russian history leaves links with the Philippines
- 5 People will try to reduce Mandela to a lilting reggae tune about ‘love’. They will fail
- < Previous
- Next >
iJobs Money & Business
£80000 - £100000 per annum + benefits + bonus: Harrington Starr: Project Manag...
£50000 - £60000 per annum + benefits + bonus: Harrington Starr: Business Analy...
£30000 - £40000 per annum + Bonus and Benefits: Harrington Starr: A global Con...
£150 - £250 per day: Cornwallis Elt : iPhone Rollout- Blackberry Enginee...
Day In a Page
A three-bedroom Grade II-listed mews house with vaulted ceilings and roof garden
A spacious Grade II-listed family home with annexe and equestrian facilities among four acres of land in Itchingfield
A four-bedroom home with exposed brick walls and open fires in the picturesque village of Northill
A Grade II-listed property with five bedrooms and unique tower, overlooking Hastings Old Town
A charming five-bedroom detached family home, set within half an acre in Kew
A two-bedroom maisonette set on the top two floors of a period building, close to Kentish Town Tube.
Take advantage of the extra space provided by former stables and outbuildings at this five-bedroom farmhouse.
This three-bedroom Victorian terrace is near to Queen’s Road Peckham station, Nunhead station.
A five-bedroom modern house with terrace, swimming pool, Zen treehouse and large carp pond
An unexpected gem with four bedrooms, remarkable vaulted reception and a galleried study area
A five-bedroom house in one of Lymington's most sought after tree lined avenues, moments from the marinas and sailing clubs
A grand early 19th century B&B close to the historic harbour, with four en suite bedrooms
A four-bedroom, 17th century home with walled gardens, a landscaped terrace, cellar and open fires
A six-bedroom house with five bathrooms and four reception rooms spread over 4,000sq ft of luxury living space
A stunning three double-bedroom apartment with two decked terraces in the exclusive gated community, Bromyard House
A 10-bedroom period, family home amid beautiful surroundings in the centre of the Wentworth Estate in Longcross village
A stylish three-bedroom apartment with two bathrooms and private landscaped garden, moments from Fitzroy Square
A Grade II-listed Elizabethan barn with landscaped gardens, exposed elm beams and four bedrooms, all with lovely views
A six-bedroom family home, dating back to 1280 with four reception rooms, barn, swimming pool and tennis courts in Harwell
A spacious two-bedroom flat, refurbished to a very high standard with private landscaped garden, close to Kentish Town station
An exceptional two-bedroom apartment with balcony and underground parking in the centre of Richmond
A one-bedroom, luxury, duplex apartment in the grand landmark building, Imperial Hall
Run a fabulous boutique shop, live above it in a one-bedroom flat and let a second one-bedroom flat that comes part and parcel
A Grade-II listed, thatched cottage in Hundleby village, with five bedrooms, a coach house and three and a half acres
A spacious two-bedroom flat in the heart of Hoxton Square with wooden floors and roof terrace
A five-bedroom family home with stunning pool and gym complex set among two acres of land
A six-bedroom period house with heated swimming pool and a separate two-bedroom annexe cottage in Townlake, £795,000
A spacious and contemporary two-bedroom flat arranged over three floors, with garden patio close to St George Square, £600,000
A one-bedroom flat in a beautiful Regency building opposite the beach in Kemp Town, £190,000
A two-bedroom flat with London skyline views close to Surrey Quays. £395,000.
A seven-storey tower with three bedrooms and a stunning roof terrace. Guide price: £850,000.
A 16-bedroom country pile with nine reception rooms, four self-contained flats and a 13th century Peel Tower. £850,000.
A classic six-bedroom Victorian Manse house 10 miles from Edinburgh. £495,000.
John Lennon's childhood home in Liverpool to be sold at auction. Guide price: £150,000-£250,000.
A six-bedroom detached period property with secluded gardens, ample parking and a double garage in Rye, £675,000.
A large split-level property with three double-bedrooms and roof terrace, close to Crouch End Broadway, £625,000.
A charming barn conversion in the picturesque Cotswold village of Ilmington with three bedrooms, a detached garage, workshop and beautifully manicured gardens £675,000.
A three-bedroom new build, ground-floor flat with two bathrooms, close to Bermondsey tube, £445,000.
A three-bedroom house in an enviable new development moments from Oxshott High Street, with secluded garden and decked area, £385,000
A two-bedroom split-level flat with stunning south-west facing roof terrace in the popular Brondesbury Conservation Area, £549,950.
A charming 16th century, three-bedroom detached house in Bidborough with picturesque garden