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TSB raises rates by up to 0.25% and "has joined the dartboard approach to mortgage pricing"

Journalist: Justin Moy, Contributing Editor

ended 29. October 2024

TSB have today announced a range of mortgage rate increases of up to 0.25% for home movers, remortgages and buy-to-let borrowers. 2-year fixed rate first-time buyer and home mover mortgages at 75%-80% and 85%-90% LTV rise by 0.1% while 2-year fixed rate remortgages up to 60% loan-to-value (LTV) will rise by 0.25%. 2- and 5-year fixed rate buy-to-let remortgages up to 75% LTV have been raised by 0.1%. Brokers said the current rate turbulence is clearly being driven by lender nerves ahead of the autumn Budget. They hope it will be business as usual once the Budget is behind us with the markets pricing in another rate cut when the Monetary Policy Committee meets on 7 November. But there is still the potential for the Chancellor to deliver a Budget that bond vigilantes do not like, creating further volatility. It's a big day tomorrow.

5 responses from the Newspage community

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Iain Swatton
Director at Exemplar Financial Services
In raising rates again, it seems TSB has joined the dartboard approach to mortgage pricing, signalling that lenders are on edge ahead of tomorrow’s Budget. While this may be about lenders fine-tuning their rates, the appearance of uncertainty isn’t helping consumer confidence. At the moment, it looks as if the industry can’t quite decide which way to go, keeping potential buyers and borrowers guessing. With the Budget just a day away, here’s hoping for some clear direction and a return to stability once it’s out, whatever the outcome.
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Simon Bridgland
Director at Charwin Private Clients
TSB must be thinking the short-term gain for borrowers on some 2- and 5-year deals would turn into their long term pain. Increasing the rates on these deals to shore up their margins is perhaps just some last minute adjustment before tomorrow’s Budget hangover hits home.
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Dariusz Karpowicz
Director at Albion Financial Advice
This adjustment from TSB comes at a particularly intriguing time in the mortgage market landscape. We're witnessing a split in lender behaviour, with some institutions reducing rates while others, like TSB, opt for increases. This divergence appears to be strategic positioning ahead of both the upcoming Budget announcement and the Bank of England's base rate vote. With early Budget leaks suggesting challenging conditions ahead, TSB's move might be indicative of a more cautious market approach. For prospective borrowers, this development underscores the importance of seeking professional mortgage advice sooner rather than later.
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Ken James
Director at Contractor Mortgage Services
The mortgage market is in a bit of a mess with some lenders like TSB increasing and others decreasing. This is sending mixed messages out to potential buyers and sellers. Unsuprisingly, the Budget is the centre of everyone's focus and lenders are playing it safe waiting to see how this will unfold. Once the dust has settled later this week we will see the true fallout of what damage Rachel Reeves has unleashed.
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Dennigan Tyson
Mortgage & Protection Adviser at Pia Financial Solutions
I am not surprised and I think there was always going to be an element of caution from certain banks. Let's not forget, this is a monumental day for the UK economy and, due to the sheer volume of fiscal policies being proposed, it was only natural for some banks to increase rates. Thankfully, it hasn't been widespread and the increases have been minor. Bring on Thursday......