Nationwide increases tracker mortgage rates

Like some other lenders the Nationwide has increased its tracker rates. A two year tracker, which carries a £599 fee, has gone up as follow:

60% LTV 5.94% becomes 6.18% (up 0.24%)

75% LTV 6.04% becomes 6.28% (up 0.24%)

85% LTV 6.49% becomes 7.08% (up 0.59%)

Tracker rates will go down by 0.50% on November the 1st as previously announced, so a two year tracker will be 5.68% at a 60% LTV.

So it would appear that more risk is being factored into the higher LTV trackers with the general feelings in the market being that house prices have some way still to fall.

Matthew Carter, divisional director for mortgages at Nationwide, said: "Like all lenders, we continually review our mortgage product range in light of competitor changes and market conditions. For example, many of our competitors have recently increased the rates on their tracker mortgages.

"It is regrettable that we have to increase our tracker rates but we must take into account ongoing volatility in the wholesale markets and the high cost of funding.

"These changes will allow us to maintain control of the volume of business the Society is attracting, and to continue lending in a responsible and prudent way."