Keystone Property Finance has announced that it will increase its 5-year fixed rate mortgage options as of tomorrow, Wednesday 10 January.
This increase follows an ongoing rise in swap rates, which has heavily impacted the market over the past few days.
In order to reprice existing products, the lender informed brokers that it will be redrawing existing rates as of 8pm today, Tuesday 9th January.
Nicholas Mendes, head of marketing at John Charcol, said: “Swaps have increased every day since last week.
“With the gap narrowing sub 4% on a 5-year fixed, or 4.5% on a 2-year fixed rate are no longer viable for lenders.
“I suspect the next rate change from the lenders who had announced cuts last week will be upwards.”
He added: “It will be interesting to see which lenders have enough appetite for volume, even at skinny margins, to hold on to their current low rates longest!
“Yesterday, we had the latest KPMP and REC job survey for December, which highlighted a resilient labour market and growing increase in starting UK salaries.
“This latest development means that the Bank of England is expected to keep interest rates higher for longer, rather than decrease in March, which was widely tipped a fortnight ago prompting a fall in gilts and in the swap market.”
