Rate hikes add to first-timers’ woes

Nationwide has ramped up the rates on its 75% and 90% LTV deals by 0.2%.

This is a further blow for first-time buyers following the withdrawal of all 125% LTV products from the market.

Nationwide’s two-year fixed rate 90% LTV deal has been increased from 6.25% to 6.45% with no reservation fee.

Its two-year 95% LTV fixed rate product at 6.85% remains unchanged with no reservation fee, although borrowers can opt for the same LTV at 6.45% with a £499 reservation fee.

But Matthew Carter, director of mortgages at Nationwide, says: “Our deals continue to offer excellent value for those looking to borrow up to 95% of the value of their property.

“But first-timers should shop around and compare the cost of each deal before committing.”

He says customers must be aware of the higher lending charges that form part of competitors’ high LTV mortgages – a fee Nationwide doesn’t charge.

Peter O’Donovan, mortgage manager at brokerage Bestinvest, says: “It’s a shame that Nationwide has done this. High LTVs are being withdrawn, track-er rates are going up and first-time borrowers are paying the price.”