The latest change means the mutual is no longer offering the sub-four per cent mortgage deals it did last month.
Rates now begin at 4.19 per cent for a five-year fixed remortgage deal at 60 per cent loan to value (LTV). This has a £999 fee and was previously 3.99 per cent. The fee-free option is priced at 4.39 per cent.
For new homemovers and first-time buyers, the five-year fixed product at the same LTV tier with a £999 fee has a rate of 4.24 per cent, a 0.1 per cent increase. The fee-free homemover option is priced at 4.44 per cent and the first-time buyer product has a rate of 4.54 per cent.
For existing borrowers, rates start at 4.04 per cent for its fee-free two-year fixed additional borrowing green mortgages from 60 to 90 per cent LTV.
Swap rates swinging upwards
A spokesperson for the mutual said it needed to ensure its mortgage pricing was “sustainable at a time where swap rates, on which mortgage pricing is based, continue to fluctuate”. It noted that swap rates had began to rise recently.
Rates have been increased by between 0.05 per cent and 0.21 per cent.
Henry Jordan (pictured), director of home at Nationwide Building Society, said: “Over the last few months, we have continued to lower rates across our mortgage range, including doing so four times this year.
“However, given the recent increase in swap rates, we are having to make some small increases on selected mortgage rates this week so that we can continue to balance our support for all types of borrowers with the need to ensure our rates remain sustainable.”
Mindful of wholesale costs
Reacting to the news, mortgage professionals said the rate increase was inevitable as market conditions had changed.
Steven Morris, advising director at Advantage Financial Solutions, said the cost of borrowing money had risen by 0.3 to 0.4 per cent in recent weeks.
He added: “Given this is a problem being faced by all lenders offering fixed rate mortgages, it seems inevitable others will follow suit, at least to some extent. For now, we hope these changes are things ‘settling down’, rather than a total U-turn on the recent rate cuts we have seen so far in 2023.”
Justin Moy, managing director at EHF Mortgages, said lenders would be affected by the further Bank of England base rate rise pencilled in for March.
“Analysts still predict that the base rate will fall towards the end of the year, but there may be some bumps along the way,” Moy added.
