New mortgage hikes announced

Nationwide Building Society has become the latest mortgage provider to announce a rate hike in response to the increases in the base rate made earlier this month.

Home movers can now choose from interest rates spanning from 5.28 per cent for a two year tracker with a £599 fee to a no-fee two year fixed-rate mortgage at 6.08 per cent.

Customers choosing to remortgage with a two year fixed-rate deal have the choice of paying no fee for a 6.18 per cent interest rate, £499 for a 5.78 per cent rate or £999 for the 5.68 per cent mortgage.

The new rates reflect the quarter point rise in interest rates in early May as well as a trend of interest rate hikes which has seen the Bank of England’s Monetary Policy Committee steadily raise the base rate since August 2006.

Nationwide has also announced that it has increased the maximum loan to value of remortgages from 90 per cent to 95 per cent.

While this seems like good news, a recent report called On The Treadmill by a group of academics pointed out that ’super-size’ loans are making young borrowers so indebted that they are neglecting their families and becoming "like bonded labourers" to repay mortgages.