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Fri, 06 Mar 2026

Fri, 06 Mar 2026 Lenders lift mortgage rates as Iran war hits borrowing costs

Nationwide, HSBC and Coventry Building Society are all putting some mortgage rates up.
UK lenders have started raising mortgage interest rates due to increased fears of inflation following the ongoing conflict in the Middle East. Nationwide has raised its rates by up to 0.25% for new customers, while HSBC UK and Coventry Building Society will also increase their rates. The Bank of England's rate cuts may be slowed or put on hold if prices for oil and gas remain high, which could lead to higher inflation in the UK. This has pushed up swap rates, influencing lenders' decision to raise mortgage interest rates. Experts warn that borrowers should secure a fixed-rate deal as soon as possible, before rates rise further. Nationwide said its rate changes will apply to all new mortgage applications from Friday, affecting first-time buyers and existing customers who are remortgaging or switching. The average two-year fixed mortgage rate is now 4.84%, while the five-year fixed rate is 4.96%. The Bank of England's next interest rate decision is on March 19, and some experts predict that interest rates could be pushed back up to above 4% if higher energy prices persist. Lenders are also adjusting their rates due to capacity issues, as lower rates before the conflict had created a surge in applications. Experts recommend borrowers take practical steps to secure their finances, such as locking in a rate early or completing a mortgage deal within six months.