Effective tomorrow (Friday 23rd February), NatWest is set to make changes to its new business and existing customer product ranges.
For new business, purchase mortgages will see increases of up to 0.15% across 2-year and 5-year deals.
Selected remortgage and first-time buyer products will also see increases of up to 0.15% across 2-year and 5-year products, while shared equity, help to buy shared equity, and green purchase and remortgage products will all see increases of up to 0.10%.
For existing customers, a number of 2-year and 5-year switcher rates will see increases of up to 0.20%.
Nicholas Mendes, head of marketing at John Charcol, said: “It’s certainly not been a week to remember.
“NatWest is following HSBC today, and Santander, Coventry, TSB who have made similar moves earlier this week.
“It is understandable to see lenders reprice as the market landscape is continually changing, but I would stress to those that are delaying submitting an application to still do so.
“While I expect fixed rates to reduce, it is going to take slightly longer than anticipated.
“If you tie into a deal now, you still could change close to completion if a better deal comes along, but if there continues to be any adverse changes in the market, at least you have secured a more favourable deal.”
Newspage asked brokers for their thoughts on the most recent of high street rate hikes.
Reaction:
Justin Moy, managing director at EHF Mortgages:
“Today, yet another major high street lender has pushed rates further out of reach of borrowers.
“NatWest may be following the rest of the mainstream lenders but the collective reaction from lenders to higher swap rates will inevitably kill off all those improvements everyone worked hard for in January this year.
“Right now, it feels like 2023 is happening all over again. Someone has pressed the mortgage rewind button.”
Gareth Davies, director at South Coast Mortgage Services:
“Record profits have been announced by numerous lenders in recent days, all while consistently screwing the average household with ever-increasing mortgage rates.
“The positivity many had in January is long gone and we need to brace ourselves for a re-run of late 2022 and the summer of 2023.”
Rohit Kohli, director at The Mortgage Stop:
“Another major high street lender hikes rates. I’m sure many borrowers will be forgiven for asking the question about these rate rises in a week where multiple lenders have announced bumper profits.
“This is going to be very dissapoining for many borrrowers who had been given some hope that rates were starting to fall.
“The hope is this is a short-lived upwards movement to protect service and reflecting rising swaps.”
Ben Tadd, director at Lucra Mortgages:
“This is another example of how volatile the mortgage market is at the moment, with NatWest reacting to increased swap rates over the past few weeks.
“It’s not all doom and gloom for mortgage borrowers however, as although fixed rate pricing has risen over the course of the last month, rates have not risen to anywhere near the peak levels of the post mini-Budget era.
“Rates remain stable and with inflation anticipated to drop with the next CPI announcement due on 12th March, the positive effect this should have on SWAP rates is likely to coax mortgage rates back down.”
Lewis Shaw, owner and mortgage expert at Shaw Financial Services:
“This was always on the cards. Earlier this week, I and other brokers mentioned that other lenders would follow as the dominoes started to fall.
“The economy is not out of the woods, and we may look back on this and realise we were only just entering them.
“Do not try to second guess where mortgage rates are going or where they will be. Take action now.”
Riz Malik, founder and director at R3 Mortgages:
“NatWest’s response is no surprise as they are merely folllowing the herd so they are not left exposed.
“If lenders like NatWest do launch a 99% mortgage, it will be interesting to see not only the initial rates but also how susceptible it is to market movements.”
Gary Bush, financial adviser at MortgageShop.com:
“To hear of yet another large High Street lender, in this case Natwest, increasing its mortgage rates will bring further tears to the eyes of the general public whose household budgets are already stretched to the max.
“It worries financial advice firms to see the big Plc banks releasing record turnovers/profits off the back of the recent high-interest rate activity when consumers are struggling so much.
“We are praying that more Bank of England monetary committee members fall in line with Swati Dhingra’s opinions that cutting the base rate sooner could save the UK.”
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management:
“Whilst expected, this is not the email anyone wants to receive. 2024 started so strong and literally overnight we are back in 2023.
“Rates are being withdrawn and increased with little notice. NatWest give you until 10.30 to submit an application, so no going home at 5 and seeing your family.”
Andrew Montlake, managing director at Coreco:
“There is massive sense of Deja-Vous as yet another mainstream lender increases their rates as the age of the 3% mortgage stalls prematurely.
“Make no mistake this will feel like a heavy blow to many homeowners and borrowers who had been feeling more hopeful of late.
“Whilst we could see another turn around in due course, the Bank of England really does need to take note of the sentiment on our high streets.
“Rate cuts are needed, and if they do not come sooner rather than later the issues of an economy in free fall will haunt the bank and Government alike, just as much as those staring down the barrel of higher mortgage payments.”
Ben Perks, managing director at Orchard Financial Advisers:
“Stop this ride, I want to get off!
“It’s a fast paced environment at the moment, Natwest are the latest to increase rates further and other lenders are pulling products with little notice and announcing increases too.
“It’s not great for borrowers making plans in an ever changing environment.It’s a clear message to borrowers, don’t dilly dally if you need to borrow money secure a rate on offer quickly as they can change at any moment.
“A few hectic days ahead for Brokers.”
Michelle Lawson, director at Lawson Financial:
“What a totally disastrous grey, bland and disappointing week this has been.
“The weather is reflected in the markets and industry.
“Rates rising again is going to completely dull consumer confidence.
“Let’s hope that the tide turns and we can bring back some much needed positivity after such an encouraging start.
“The industry really can’t take much more of this uncertainty and flip-flopping.
“The Budget best be good on 6th March otherwise we might as well write 2024 off before it has started.”
Harps Garcha, director at Brooklyns Financial:
“NatWest’s rate hike announcementy today, occurring just over a week after the last increases, signals a concerning trend in the mortgage market.
“This rapid succession of increases has cast a shadow over mortgage borrowers seeking favourable rates and hoping we don’t have a 2023 deja vu!!!
“For those planning to secure a new rate soon, it’s crucial to act promptly.
“While there’s hope for rate reductions, recent events suggest otherwise. Waiting for a better deal could prove costly.”
Richard Jennings CeMAP, founder and managing director at Richard Jennings Mortgage Services:
“At the speed of rate increases coming through over the last couple of weeks I am finding myself dreading the sound of an outlook email.
“I’m not sure whether lenders are deciding they do not want to lend and as such are pricing themselves out of the market or they are becoming greedy and trying to milk the net interest margin further.
“What will ultimately happen is the announcement of record profits all at the expense of the every day consumer who is struggling to make a choice between feeding their family or heating their home.”
Mark Robinson, managing director at Albion Forest Mortgages:
“I always try and maintain positivity in the face of rate increases. But with the volume of lenders putting rates up we are headed back to where we started the year.
“I hope this is a temporary blip and they will return to falling rates soon, but it feels like perhaps lenders were too quick to drop rates in the first place if they are having to all go back on it so quickly.”
Amit Patel, adviser at Trinity Finance:
“Its Ground Hog day all over again, we seem to be stuck in a vicious cycle of rates going up and then going down again, just when we thought there would be some light at then end of the tunnel after the fiasco over the past 18 months or so.
“Rates increasing is never welcome news for borrowers that need finance now or those that are coming to the end of their fixed rates soon.
“The Bank of England need to ensure they make the right call and start reducing the base rate at there next meeting.”
