Virgin Money is hiking rates on its 90 and 95 per cent loan-to-value product transfer mortgages by up to 40 basis points this evening.

The lender has emailed brokers to warn them of the increases, which will take place at 8pm today.

Virgin has not specified exactly which rates at this LTV will increase, but a two-year fixed for those with a 10 per cent deposit is currently priced at 2.63 per cent with a £995 fee, so an increase of 0.4 percentage points would take it over 3 per cent.

A three-year fixed is currently priced at 2.75 per cent and a five-year fixed at 2.93 per cent, both with a £995 fee.

The news comes after Mortgage Brain yesterday revealed that the cost of borrowing at 90 per cent LTV has increased by 28 per cent over the past year.

Borrowers with a 10 per cent deposit who wish to fix for two years will now pay an average of £5.22 per £1,000, compared to £4.06 in November 2019.

For a £200,000 mortgage, the price increase equates to an extra £2,784 a year.

Last week Atom and TSB both returned to 90 per cent LTV lending and the week before that Accord brought out a number of 90 per cent LTV deals and said it planned to be a more “consistent” presence in the high LTV space.