Co-op puts up mortgage rates

houses with £10s

Homeowners face more misery after the Co-operative Bank announced yesterday that it would put up its standard variable rate (SVR) by 0.5%.

The rise, which will come into effect on 1 May, will take the bank's SVR to 4.74%.

The move will affect around 54,000 mortgage holders, adding £15 a month to typical repayments. This equals £180 a year.

The bank has blamed "changing conditions in the mortgage market and the increased cost of funding," for the rise.

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The bank is the fourth mortgage lender to put up its rates in recent weeks. Halifax, RBS and the Bank of Ireland have all increased their SVRs.

"This news is another blow to homeowners who could see their monthly costs shoot up at a time when their finances are already stretched to the max," says Michael Ossei, personal finance expert at

"Many of those on tracker mortgages have been enjoying drastically lower mortgage payments over the last few years as a result of the low base rate.

"However, this will bring them back down to earth with a bang. And because these increases are nothing to do with the base rate, which still shows no signs of budging, the blow won't even be softened by a corresponding increase to savings rates," he adds.

Read Ruth Jackson's blog: Why are mortgage rates rising?

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