Halifax and HSBC have announced key changes to their mortgage deals, increasing rates for remortgages and lowering purchase fixed deals for those looking to move home.
This comes despite expectations that the Bank of England will lower interest rates in a matter of months.
Mortgage brokers said this continues a common trend last week with other high street lenders.
From today, existing HSBC customers switching to a new deal or borrowing more will see certain rates for two and five-year fixed deals increase.
However, both lenders are reducing rates for first-time buyers. Halifax’s five-year deal for borrowers with a 10 percent deposit has been lowered from 4.97 percent to 4.44 percent, along with a £999 fee.
Speaking to the Newspage news agency, Justin Moy, managing director at EHF Mortgages commented: “More lenders are putting in place a significant pricing differential for those moving home compared to borrowers who are refinancing.”
However, Moy noted: “There is still plenty of encouragement for the many first-time buyers and home movers given the recent changes in the market, with remortgage business effectively financing buyers.
“Lenders know that the product transfer market is still buoyant and will pick up enough business of its own accord.”
The Mortgage Expert’s Darryl Dhoffer said lenders “can afford” to increase product transfer rates as, in many cases, they will have a “captive audience” of existing customers who will struggle to move elsewhere.
He added: “Also, SWAP rates have increased in recent days, which is having an effect on lenders’ pricing, even though the Bank of England held the Base Rate steady last week.
“Remortgages and product transfers will be saturated this year, and these increases could see other lenders follow suit.”
Ranald Mitchell, director at Charwin Private Clients said: “The polarisation between the remortgage and purchase rates being offered by some of the big lenders is spreading, with HSBC and Halifax now joining in.
“Purchase activity is viewed as new lending opportunities for banks, and some are now promoting this to boost sales figures at the expense of borrowers who are remortgaging.”
Meanwhile, Ben Perks, managing director at Orchard Financial Advisers described this as a trend seen “across the board”.
Mr Perks said: “It’s clear that lenders are trying to entice these customers. Better rates and products are made available for purchases and the remortgage borrowers are stuck with the leftovers.
“The remortgage market has been buoyant and with more than 1.5 million borrowers coming off low rates this year, it will continue to be.
“There will also be an abundance of clients’ capital raising for debt consolidation, as they struggle to manage household budgets or for home improvements, as the move to a bigger property is now unaffordable.”
He added: “Remortgages will be a big area of business for lenders in 2024 and I wish they would price attractively.”
