Barclays and NatWest customers warned over new mortgage rules that are 'disaster'

Barclays and NatWest have moved to scrap sub-4% mortgage rates. The two banks have become the latest major high street lenders to increase their fixed mortgage rates, with changes taking effect yesterday (Thursday November 14).

David Hollingworth, Associate Director at L&C Mortgages, warned that recent weeks have seen rates consistently pushed higher. "The slew of rate changes in recent weeks has continued to push rates higher, reflecting the higher costs for lenders, as the market outlook for rates has edged toward a higher for longer expectation," he said.

Despite these increases, he emphasised there's no indication of rates "skyrocketing" as seen in recent years. Barclays is upping rates by between 0.3 and 0.6 percentage points, according to Nicholas Mendes, mortgage technical manager at broker John Charcol.

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Barclays is currently offering a 3.99 per cent two-year fix to home buyers purchasing with at least a 40 per cent deposit. Its 3.96 per cent five-year fix is also likely to disappear, a deal aimed at those buying with the biggest deposits.

"Barclays has announced rate increases across its mortgage products, following similar moves by major lenders like HSBC, Santander, and Nationwide earlier this week," said Nicholas Mendes of John Charcol. "The updated rates, which apply to both fixed and variable mortgage offerings, show hikes across different loan-to-value bands and product types.

"These adjustments reflect the broader trend of rising costs in the lending market, influenced by ongoing economic pressures and changes in the interest rate environment. Barclays' revisions include notable increases in rates for its two-year and five-year fixed products across various loan-to-value categories.

"This essentially marks the end of sub 4 per cent rates from the mainstream lenders, for the time being." NatWest, which currently has the cheapest five-year mortgage deal on the market, is raising a slew of rates from Wednesday, with its 3.84 per cent five-year fix for homebuyers shooting up 0.3 percentage points to 4.14 per cent.