11/15/2016 10:04 EST

Royal Bank Of Canada To Hike Fixed Mortgage Rates

TORONTO — Royal Bank (TSX:RY) is hiking mortgage rates and making it more expensive for homebuyers who want to take more than 25 years to pay back their loan.

The bank is raising its special offer for a five-year fixed rate mortgage to 2.94 per cent, an increase of 30 basis points.

The lender is also raising its special offer for a four-year fixed rate mortgage to 2.79 per cent and three-year fixed rate mortgage to 2.69 per cent, increases of 30 and 25 basis points, respectively.

The company is also introducing new rates for homebuyers who opt for an amortization period longer than 25 years.

The special offer rates for three, four and five-year fixed rate mortgages are 10 basis points higher than for those with an amortization of 25 years or less.

The changes take effect Thursday.

RBC's move follows TD Bank's announcement earlier this month that it is raising its prime interest rate on variable-rate mortgages.

Many in the mortgage industry say the Liberals' new, tighter mortgage rules will cause lenders to raise their rates.

With a file from The Huffington Post Canada