Rising inter-bank borrowing costs force Nationwide to raise mortgage rates on 100 Mortgages

The state of our economy is looking very bleak at the moment, and we are now seeing the affects of this in the mortgage market. As you know a number of lending mortgage lenders such as Abbey have has to raise their mortgage rates p, and now Nationwide is the latest to follow suit. As from tomorrow June 3, Nationwide will increase the price of their new fixed-rate mortgage deals, the increase will be 0.3 percent. This increase comes just days after the building society announced that they are scaling back lending, this is as a result of house prices falling by 4.4 percent in just one year.

BBC News reports that Nationwide has told consumers that they should expect frequent changes” to the cost of the fixed rate deals. The increase will affect new two and three year fixed-rate deals, rates for longer deals will also see a slight increase. Matthew Carter, who is the divisional director for mortgages at Nationwide, has said “While markets remain volatile we can expect to see frequent changes to fixed rates across the industry.”

This is a bit of a strange move from the mortgage lender, as Halifax has recently cut their average rate by 0.3% from its various fixed-rate mortgage offers. The Bank of England has said that the number of mortgage approved in April were the lowest since 1993.

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