Norwich Union is raising the interest rates on its fixed rate lifetime mortgage and drawdown plans from Monday.
The interest rate on lifetime plan introduced by intermediaries will be 6.35 per cent (6.6 per cent APR). The previous rate was 6.25 per cent (6.5 per cent APR). The interest rate for business introduced directly will be 6.60 per cent (6.9 per cent APR). The previous rate was 6.50 per cent (6.8 per cent APR).
The interest rate for the drawdown plan introduced directly will rise to 6.65 per cent (7 per cent APR). The previous rate was 6.60 per cent (7.0 per cent APR).
The rate rises come in the same week Safe Home Income Plans revealed average lifetime mortgage rates were now cheaper than many standard variable rates.
NU personal finance director of sales and marketing Daren Carter says: Norwich Union has been working hard to keep lifetime mortgage interest rates as low as possible for as long as possible, but long-term interest rates have risen and this means we have had to raise our lifetime mortgage rates.