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A frantic week as repricing grips market

The rough costs to a lender of buying a tranche of money to lend as a fixed rate – known as swap rates – continued to rise last week.

• One-year money is unchanged at 4.79%

• Two-year money is up 0.03% to 4.99%

• Three-year money is up 0.03% to 5.08%

• Five-year money is up 0.06% to 5.18%

As lenders&#39 tranches have run dry, last week saw a flurry of rate pulls and increases.

Northern Rock has announced the withdrawal of its two-year fixed rate at 4.49%.

Other lenders to reprice include Co-Operative Bank which increased the cost if its two-year discount, and Bristol & West which repriced its fixed and discount rates with applications needing to be in this Friday. B&W is also pulling its long-standing three-year fixed at 4.65% which has been an exclusive of several brokers.

The Mortgage Works has increased its excellent buy-to-let fixed rates with the new two-year rate at 5.19% still good value.

Other repricers were Lambeth, GMAC-RFC, Bank of Ireland and West Brom. All in all a frantic week.

Villain of the week is Cheltenham & Gloucester for its new credit scoring system. Understandably it requires several proofs of address if a client is not on the voters&#39 roll but now if the property is registered even slightly different on the roll it will still ask for the additional proofs. Let&#39s hope its credit risk department gets its act together soon.

Three-month LIBOR is down 0.03% at 4.37%. As the current base rate is 4%, the City is expecting another 0.25% in the next three months. Twelve-month LIBOR is unchanged at 4.82% indicating a 0.75% increase in the next 12 months.

With figures showing credit card debt being racked up faster than ever, the Bank of England will meet on May 5 and 6 and it is looking more and more certain it will increase the base rate next month.

Jonathan Cornell is technical director Hamptons International Mortgages


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