238 Nationwide Mortgages rise...

Atomix

https://www.thisismoney.co.uk/money/mortgageshome/article-10375115/Nationwide-hikes-mortgage-rates-base-rate-rise-savers-waiting-interest.html#comments

0.15% interest rate increase wasn't it?....

ACG

It is not quite as simple as that.
I was doing some research for a customer earlier this week, Nationwide were the top of every option I found. That means they were probably getting a lot of business in over Christmas and New year. There is probably an element of wanting to stem some of that and also knowing they can earn more from those mortgages. 

Also on top of that, the government was providing very cheap money to banks to lend out to keep the market going. That has stopped now.

In terms of savers, I was on a webinar with a lender (not nationwide) in early December. They basically said that at the minute they are sat on £200m worth of savings MORE than they were pre covid. In addition to that, they had less money leant out to businesses as they had all refinanced using the bounce back loans.  That meant they had a lot of money to lend out and so rates on mortgages were artificially low. 

In short, one bank alone had £200m extra to lend out. They had no incentive to pay extra interest because it would not have effected their mortgage business if half of that money was withdrawn overnight. I assume Nationwide are in a similar sort of position. 

It was quite an interest webinar in geeky sort of way. 

Basically, as the world gets back to normal and people begin to spend money, expect mortgage and loan rates to increase. 

Folksriker

I've had a mortgage offer but haven't completed yet, will it still go up?

Thrugelmir

Atomix said:

0.15% interest rate increase wasn't it?....

Mortgage lenders have to raise the funds on the international markets that they advance. No linkage to BOE base rate directly. Many factors are now coming into play. 

n15h

ACG said:

It is not quite as simple as that.
I was doing some research for a customer earlier this week, Nationwide were the top of every option I found. That means they were probably getting a lot of business in over Christmas and New year. There is probably an element of wanting to stem some of that and also knowing they can earn more from those mortgages. 

Also on top of that, the government was providing very cheap money to banks to lend out to keep the market going. That has stopped now.

In terms of savers, I was on a webinar with a lender (not nationwide) in early December. They basically said that at the minute they are sat on £200m worth of savings MORE than they were pre covid. In addition to that, they had less money leant out to businesses as they had all refinanced using the bounce back loans.  That meant they had a lot of money to lend out and so rates on mortgages were artificially low. 

In short, one bank alone had £200m extra to lend out. They had no incentive to pay extra interest because it would not have effected their mortgage business if half of that money was withdrawn overnight. I assume Nationwide are in a similar sort of position. 

It was quite an interest webinar in geeky sort of way. 

Basically, as the world gets back to normal and people begin to spend money, expect mortgage and loan rates to increase. 

I found your post interesting as IMO it sums up what many lenders could also be thinking about mortgage/savings rates and where these rates could be heading in the coming weeks. 

Windofchange

Folksriker said:

I've had a mortgage offer but haven't completed yet, will it still go up?

No. Your mortgage offer will be valid for a period of (usually) six months from the date of issue and will not change. If you don't complete before this expires then you will need to extend it which is usually straightforward.