Santander has issued a new update for customers after Halifax also said it was making changes from today. It has followed hot on the heels of Halifax in announcing it is increasing mortgage rates, with brokers saying 'this is certainly showing where the market is heading for now'.
A significant percentage of the Santander rate increases are of 0.15% but some products are being priced up by 0.19%. The lender is increasing most fixed rates and selected tracker rates across its new business range, as well as some residential fixed rates in its product transfer range. There are no changes to tracker rates in its remortgage and product transfer ranges, or buy-to-let rates in its product transfer range.
Brokers React to Market Direction
Anthony McQuilliam, director of Essex-based Bolt Mortgages, said: 'When Santander follows Halifax within 24 hours, that's not a coincidence, that's a signal. The two biggest high street lenders repricing on the same day tells borrowers everything they need to know about where the market is heading in the short term.'
Jon Davis, founding director of Worthing-based Davis & Co Financial Solutions, said the timing of many lender cuts was putting lots of pressure on borrowers and brokers alike: 'This is certainly showing where the market is heading for now, and the way some lenders are acting with these changes is putting the stress and strain on both the customer and the broker.'
Darryl Dhoffer, founder of Bedford-based The Mortgage Geezer, also said the trend of rising rates was now clear: 'Santander’s rate hikes hit at a critical juncture for UK borrowers, signalling persistent upward pressure driven by volatile swap rates. By raising fixed and selected tracker rates for new buyers alongside residential fixed deals for existing clients, Santander aligns with a broader market shift following similar moves across major lenders. Leaving buy-to-let and certain remortgage trackers intact offers minor relief, but the trend is clear: windows are tightening and borrowers facing upcoming renewals must secure rates promptly to avoid escalating costs.'
Oil Prices and Inflation Concerns
Emma Jones, managing director of Whenthebanksaysno.co.uk, said the soaring price of oil last week was to blame for higher rates, despite the fact that the price had eased so far this week. She added: 'Amid ongoing tensions in the Middle East, the price of oil has been on the rise again and that risks feeding inflation, which could see interest rates rise or at least stay higher for longer. Lenders are taking that into account along with wider uncertainty around the conflict. Markets and lenders are increasingly nervous about inflation and that is now starting to really hit borrowers here in the UK with higher mortgage rates.'
Omer Mehmet, managing director of Welling-based Trinity Finance, agreed: 'More rate hikes were almost inevitable after the oil price shot up last week following an escalation in the Middle East and it's no surprise to see these increases from Santander. Once again, the lesson for borrowers is never take further rate cuts for granted as the mortgage market can turn in an instant.'
Stephen Perkins, managing director of Yellow Brick Mortgages, also urged anyone waiting to lock into a mortgage to do so now. He added: 'For borrowers, it's a reminder that mortgage pricing can change quickly. Waiting in the hope of securing a slightly lower rate can sometimes have the opposite effect if market conditions move against you. We refer to that as the "waiting penalty".'
