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Halifax increases rates by up to 0.32% in "another negative adjustment in the lending landscape"

Journalist: Justin Moy, Contributing Editor

ended 13. March 2024

Halifax has just announced remortgage rates, product transfers and further advances for 2-year deals are increasing by up to 0.32%  from 8pm, Thursday 14th February. Newspage asked mortgage brokers for their thoughts on this and why rates are going up when the cost of money is starting to fall. Their views are below.

12 responses from the Newspage community

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Editor
Dariusz Karpowicz
Director at Albion Financial Advice
Halifax hiking rates by up to 0.32% marks another negative adjustment in the lending landscape. This latest rate hike by the nation's leading residential lender swiftly follows a prior increase, signalling a potent trend. Halifax's actions not only spotlight its market strategy but also potentially steer the direction for other lenders. Despite emerging signs of a decrease in the cost of borrowing, this rate rise points to a complex mix of factors driving such decisions. It highlights the fluid nature of the mortgage market, where lenders navigate through a myriad of market dynamics, regulatory frameworks and economic signals.
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Richard Jennings CeMAP
Founder & Managing Director at Richard Jennings Mortgage Services
The only thing that's consistent in the mortgage market at present is its inconsistency. After GenH and Coventry both announced rate cuts, I hoped this would be the beginning of several lenders doing the same, so to see Halifax announce rate rises of up to 0.32% dashes those hopes. Continuing the theme of punishing existing borrowers rather than new ones, I note the highest rate rises are for those looking for product transfers and further borrowing. Loyalty is a two-way street that lenders appear to very seldom walk down.
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Gareth Davies
Director at South Coast Mortgage Services
Halifax are smashing it out the park with their good news today. Not. Awful timing for this rate increase announcement off the back of today's equally awful criteria change.
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Amit Patel
Adviser at Trinity Finance
The mortgage market appears drunk. I need a drink.
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Darryl Dhoffer
Founder at The Mortgage Geezer
Halifax were already in a hole this morning with the news that they are reducing certain maximum age limits from age 75 to 70, which doesn't help borrowers stretched to the limit already. With these rate rises, they are still frantically digging a bigger hole. When SWAP rates are cooling, why are lenders increasing rates? The one positive is that we've at least had over 24 hours' notice.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
There is nothing in the economic data over recent days to support such a hike in rates. So unless Halifax are inundated with enquiries and trying to turn off the taps, this rate rise seems wildly out of touch with the market.
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Justin Moy
Managing Director at EHF Mortgages
It's a shame to see more rate increases, this time from the largest high street lender. A real mixed message from lenders today, with Coventry announcing lower rates while others continue to in the other direction. Some of this may be down to increasing workloads at lenders, as processing times have been slipping for many weeks across the sector. But with SWAP rates starting to fall, it would be prudent for lenders to to at least hold rates steady for a period of time, and not make it more expensive for borrowers.
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Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
With SWAP rates easing back, I'm as surprised as anyone by these rates increases from Halifax. To make matters worse, they're not small either. It's possible that this is a temporary move to stem the inward flow of applications, but either way, it's not good to see. On a day when Coventry Building Society has reduced rates, the mortgage market appears to have lost the plot.
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Ben Perks
Managing Director at Orchard Financial Advisers
With Swap rates trickling down and other lenders announcing cuts, this has to be a tactical increase to stem the inflow of business. They have been sourcing competitively recently, so after an influx of applications they need to step back and look after their service levels. I don't think borrowers need to be spooked by this, but it would be nice to have a little more stability in rates to give people confidence.
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Imran Hussain
Director at Harmony Financial Services
What a shame. There is nothing in the market data that supports increases right now. The only people losing out are borrowers. We need some sort of stability around rates now more than ever.
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Luke Thompson
Director at PAB Wealth Management
This is Halifax's second strange decision of the day. They have been competitive on price in recent weeks it has to be said but the cost of money has been falling in recent days and we have had rate reductions from a couple of lenders this week. Halifax know, though, that a lot of their business is criteria driven and with this in mind a lot of the time they can charge what they want as long as it isn't too expensive and customers will have to pay it as the business they tend to attract often won't fit with other high street lenders.
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
With the wholesale cost of lending for lenders dropping in the past month by well over 0.5%, it feels like these rate increases are there to boost profit margins and keep a lid on new business volumes rather than a sign of rates increasing. With some lenders over a month behind on checking paperwork, it's a real problem.With base rate cuts seemingly round the corner, I'd hope to see lenders dropping rates again soon. It appears that they can afford to.