Selected fixed and tracker products will be affected by the remortgage rate rise while the homebuyer increase will be applied to two-year fixed rate deals only.
TSB said the increases brought it in line with recent moves across the market.
Yesterday, Halifax and Nationwide both increased rates on selected products.
Halifax updated its intermediary website to show an increase in rates across its products. A 0.20% basis point increase was applied to its two and five-year fixed rates up to 85% LTV for homemovers and remortgages with a 0.10% rise on 60% LTV deals.
Rates on product transfers were increased by up to 0.30%.
Halifax said the decision to raise rates was a response to market conditions and funding costs.
Nationwide raised rates on selected products up to 80% LTV by a maximum of 0.15%.
Brian Murphy, head of lending at Mortgage Advice Bureau, said the number of lenders making rate increases was still minimal. “These are small increases which are fairly negligible,” he said. “We need to remember that the position we are coming from is an incredibly low base.” But Murphy said it could well be the start of an upward trend in mortgage rates.
There was speculation that the Bank Base Rate (BBR) would rise last week on what was dubbed ‘Super Thursday’. Thursday was considered to be out of the ordinary because the Bank decided to publish its decision on whether to change the Base Rate on the same day as the minutes explaining how and who arrived at the decision and its quarterly inflation report all on the same day.
Minutes from the Monetary Policy Committee’s meeting revealed only one member, Ian McCafferty, voted for a rate rise. Since then MPC member David Miles said in an interview with Bloomberg that he thought there was a ‘reasonable case’ for increasing the BBR in last week’s meeting to avoid faster rises in the future.
He said that UK mortgage borrowers were more susceptible to sharp increases in the BBR because typically they took shorter-term fixed rates and a higher proportion of variable products than borrowers in the US. He said that this meant sharp policy moves by the Federal Reserve would not have as dramatic an impact on debt affordability.
“That’s not the case in the U.K. where it really has a big impact very quickly,” Miles said.
