Nikka Sulton

Nationwide and Virgin Money are increasing a range of mortgage rates, with the changes taking effect from 30 September.

The latest increases cover fixed-rate and tracker products across home movers, first-time buyers, remortgages and product transfers.

Nationwide Raises Fixed Rates

Nationwide is increasing its two-, three-, five- and 10-year fixed mortgage rates, alongside selected two-year tracker products.

For existing and new homemovers, two-, three- and five-year fixed rates will rise by between 0.06 and 0.18 percentage points.

Following the changes, rates will start at:

Two-year fix: 4.99%
Three-year fix: 5.04%
Five-year fix: 5.01%

Selected two-year tracker mortgages at 75% to 90% loan-to-value will also increase by between 0.03 and 0.06 percentage points, with rates starting from 4.09%.

First-Time Buyer Rates Increase

First-time buyers will also face higher rates across Nationwide’s two-, three- and five-year fixed products.

The increases range from 0.05 to 0.21 percentage points, with new rates starting at:

Two-year fix: 5.16%
Three-year fix: 5.21%
Five-year fix: 5.05%

Remortgage products are also becoming more expensive, with increases ranging from 0.02 to 0.20 percentage points.

The lowest rates in this range will start at 5.04% for two-year fixes, 5.09% for three-year fixes and 5.06% for five-year fixes.

Nationwide’s two-year tracker rates will start from 4.17%, following increases of between 0.03 and 0.09 percentage points on selected deals between 60% and 90% LTV.

Nationwide Product Transfers Also Rise

Borrowers staying with Nationwide will also see higher rates when switching to a new deal.

Product transfer rates are increasing by between 0.04 and 0.20 percentage points. Two-year rates will start from 4.89%, while five-year fixes will start at 4.97%.

For 10-year fixed product transfers, the lowest rate will be 5.16%.

Further Mortgage Rate Rises Expected

Aaron Strutt, products and communications director at Trinity Financial, said Nationwide’s latest changes follow further increases from several major lenders.

He noted that Nationwide had waited almost two weeks since its previous increase before making the latest changes, while some other lenders had raised their fixed rates more than once during that period.

Strutt said Nationwide would have just one fixed-rate mortgage below 5% available to new customers once the changes take effect. This is a two-year fix at 4.99% with a £1,499 fee for borrowers with a 40% deposit.

He added that the number of fixed-rate mortgages below 5% is becoming more limited, although borrowers can still find tracker deals.

Strutt also suggested that further lenders could increase their rates in the coming days, while reductions currently appear less likely.

Virgin Money Also Increases Rates

Virgin Money is making similar changes to its mortgage range, with higher rates applying to purchase and remortgage products from 30 September.

Two-year fixed purchase rates will increase by up to 0.13 percentage points, while five-year fixed rates will rise by as much as 0.11 percentage points.

Shared ownership mortgages are also affected, with fixed rates increasing by up to 0.13 percentage points.

For remortgages, two-year fixed rates will rise by up to 0.12 percentage points and five-year fixes by as much as 0.16 percentage points.

Borrowers looking to transfer their existing Virgin Money mortgage to a new product will also face increases. Two-year fixed rates are rising by up to 0.20 percentage points, while three-year fixes will increase by up to 0.16 points.

Five- and 10-year product transfer rates will rise by as much as 0.20 percentage points.

The latest changes from both lenders add to the recent movement in mortgage pricing and could affect borrowers who are looking to secure a new deal or refinance in the coming weeks.