Strategic Finance

RBS increases fixed rate deals

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Strategic Finance
Written by Roberta Murray   
Monday, 11 May 2009

Forward looking RBS sees rates on future mortgage deals increase.

 

Royal Bank of Scotland (RBS) has increased the rates on its two, three and five year fixed rate deals by up to 0.7 percentage points last night.

The lender has raised the cost of a two-year fix for customers with a 20 per cent deposit from 5.09 per cent to 5.79 per cent. The rate on a five-year fix for borrowers with a 15 per cent deposit also jumped from 6.09 per cent to 6.59 per cent.

According to the Times Online RBS is also increasing rates by up to 0.7 percentage points under its First Active brand. The rate changes apply to deals available through brokers.

The state-controlled bank is not the only lender to push up the price of new home loans.

Tomorrow, Yorkshire Building Society will increase the cost of a five-year fixed-rate deal by 0.4 points to 4.99 per cent.

Britannia is also expected to increase its market-leading rates next Tuesday.

Analysts say that lenders are pricing in future house price rises and improving market conditions into the deals.

On a subdued FTSE RBS (LON:RBS) shares were down 1.90% to 46.50p.
 

 
 
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