From Friday March 6, selected fixed rates for first-time buyers, home movers, remortgages, switchers, and additional borrowing products will rise by up to 0.25%.
Brokers warn this is “more bad news for borrowers,” with other lenders expected to follow in the coming days.
Energy bills add to the squeeze
The news comes as energy supplier Octopus Energy has introduced temporary exit fees for customers leaving fixed tariffs. An Octopus spokesperson said: “Wholesale energy prices have risen considerably this week, and we can no longer absorb the full cost of the energy we buy in advance for new fixed‑tariff customers if they choose to leave us during the period of the fix.
“We’ve had to introduce exit fees temporarily.”
The move highlights how geopolitical tensions are affecting household budgets beyond mortgages, with rising oil and gas costs expected to feed into inflation.
Why rates are rising
Mortgage rates are closely linked to swap rates, which determine the pricing of fixed mortgages. Swap rates have climbed in recent days as markets price in potential inflation from the conflict.
On Thursday, the 2-year swap rate rose 7.5 basis points to 3.56%, and the 5-year swap rate increased 7.9 basis points to 3.70%. Brokers warn that continued volatility could push more lenders to raise rates.
Babek Ismayil, CEO at homebuying platform OneDome, said: “Seeing three big lenders increase rates in a day is not the news borrowers want.
“The conflict in the Middle East could prove inflationary, meaning the Bank of England rate cuts many expected may not materialise for now.”
Adam Stiles, Managing Director of Helix Financial Partners, added: “The events of the past week have spooked the markets, driving swap rates higher.
“More lenders are likely to increase rates until things settle, though the timeline is uncertain.”
Unlike most co’s, Octopus rarely has exit fees.
We are introducing now only for *new* fixed tariffs
This is because when you buy a fixed tariff now we are buying a year’s worth of energy for you, in a very challenging market. Other co’s aren’t offering fixed tariffs at all.
1/n https://t.co/AHXzQN03ZD— Greg Jackson (@g__j) March 5, 2026
What borrowers should do
Experts stress that rates, while rising, remain competitive. Justin Moy, MD of EHF Mortgages, said: “Shop around and use a broker — your rate isn’t secured until your full application is submitted. Acting quickly is key in this volatile market.”
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management, added: “Other lenders are likely to follow suit. Just as the market was gaining momentum, the outlook has changed dramatically. Borrowers need to be aware and prepared.”
Richard Davidson, mortgage advisor at onlinemortgageadvisor.co.uk, noted: “This is likely cautious repricing in the face of uncertainty rather than a definitive shift.
“Rates are still lower than the peaks seen in 2023.”
Mike Staton, director at Staton Mortgages, warned: “This is how a war thousands of miles away affects your monthly mortgage payments. Oil and gas prices rise, pushing inflation up, which keeps borrowing costs higher.”
Even small rate increases can affect monthly repayments for millions of homeowners. Combined with rising energy bills, many households could feel the pinch over the next few months.
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Energy and mortgage pressures combined
Greg Marsh, household finance expert and CEO of AI money-saving platform Nous.co, said: “Gas and electricity bills are set to fall in April thanks to the Ofgem price cap, but higher wholesale costs could push bills up later this year.
“Households shouldn’t panic, but should watch fixed deals closely.”
The Middle East conflict has injected fresh uncertainty into both the mortgage and energy markets, reminding UK households how global events can directly hit their finances.
Nationwide’s rate rise is a sign that borrowers must stay vigilant. With other lenders likely to follow, now is the time to review mortgage deals, consult brokers, and plan for higher monthly costs – while keeping an eye on energy bills that may also be creeping up.