Clydesdale and Yorkshire Banks are increasing their SVR for residential mortgage customers from 4.59 per cent to 4.95 per cent.
The change, effective from May 1, will affect around 30,000 existing mortgage customers.
The banks say borrowers will see an average increase in repayments of less than £30 a month and say the hike is due to the increased cost of mortgage funding.
Until July 31, the lenders will waive their exit fees so impacted customers can remortgage to another provider.
Retail director Steven Reid says: “While our SVR will continue to remain competitively below a number of other UK mortgage providers, the market and costs associated with providing mortgages have changed significantly in the three years since the rate last moved.
“We don’t take such decisions lightly and fully appreciate the impact this will have on some customers but you only have to look at the narrow gap between longer-term savings rates and mortgage borrowing rates to see how things have changed.”
Earlier this month, Halifax announced it would increase its SVR from 3.49 per cent to 3.99 per cent from May 1 and Bank of Ireland announced its SVR would increase in two stages to 4.49 per cent from 2.99 per cent by September.