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300 UK mortgage deals pulled in a day as heralds rate rise

Nearly 300 mortgage deals have been pulled in the last 24 hours by banks, and building societies after a fall in the pound fuelled forecasts of a jump in interest rates to nearly 6%.

HSBC and Santander were the biggest lenders to pull mortgage products, with Bank of Ireland, Clydesdale Bank, Post Office Money and building societies, including Monmouthshire, also among the brands to have withdrawn products as lenders struggle to price loans.

“We will be removing our 60% and 85% loan to value products for new customers and increasing other rates for new and existing customers from 10 pm this evening,” said Santander in a statement. “Customers who have already applied by this time will not be impacted. We continually review the products we offer in light of market conditions.”

HSBC also temporarily withdrew its new business residential and buy-to-let products on Tuesday. In a statement, HSBC said: “In order to ensure that we stay within our operational capacity, from time to time, we need to limit the amount of business we can take each day. Our broker products will be available again tomorrow.”

Virgin Money and Skipton building society were among the lenders that said they were pulling their mortgage deals on Monday.

The country’s largest mortgage lender, Halifax, also said it was withdrawing its fee-paying mortgage products – in which borrowers pay an arrangement fee to secure a lower fixed interest rate – and moving to a full fee-free range from Wednesday.

“As a result of significant changes in the cost of funding, we’re making some changes to our product range,” a Halifax spokesperson said.

On Tuesday, there were 3,596 residential mortgage deals available, 284 fewer than before the sharp fall in the value of the pound on Monday morning, according to the data firm Moneyfacts. At the end of last year, would-be borrowers had 5,315 products to choose from.

Rachel Springall, a finance expert at Moneyfacts, said the market was extremely volatile and advised borrowers to seek independent advice to assess their best option. “The upheaval in the mortgage market may cause frustration among both borrowers and brokers as they see deals disappear overnight,” she said.

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