30 October 2017
Nationwide Building Society is tomorrow (31 October) improving its rates for mortgage customers and outlining its response to any decision by the Bank of England to increase the Bank Rate this week.
As mortgage customers look to secure competitive rates in the light of the uncertainty around Bank Rate, the Society is cutting rates for both house purchases and remortgages. Fixed rates will be reduced by up to 0.50%, now starting at 1.29%. These rates are also available for existing members looking to switch, with an additional £100 cashback as a thank you for their loyalty.
Should the Bank of England announce a rise in Bank Rate on Thursday by 0.25%, Nationwide will be increasing savings rates by 0.25% for all members who received a reduction of 0.25% as a result of the Bank Rate reduction in August 2016, including the Society’s most popular products.
- Fixed mortgage rates are being reduced by up to 0.50%. For the 60 per cent loan to value (LTV) products, fixed rates now start at 1.29% for the two-year fixed rate with a £999 fee.
- Existing members can switch to the same products as new customers, with an additional £100 cashback as a thank you for their loyalty.
- In the event of a Bank Rate rise, the Society’s Base Mortgage Rate (BMR) and Standard Mortgage Rate (SMR) products will increase. These rates would remain competitive in the market at 2.5% and 3.99% respectively, on the assumption of a 0.25% rise.
- The Society’s Base Mortgage Rate (BMR) remains one of the lowest revert to rates in the market, with estimates suggesting that compared to the standard variable rate charged on average by other major lenders, more than 500,000 BMR borrowers have benefitted from a saving of around £1,100 in the last year alone.
- Variable rates linked to the Bank Rate from Nationwide’s specialist lending subsidiaries, including The Mortgage Works, would also increase by 0.25% if the Bank Rate rose. Reversing the change made as part of the August 2016 reduction.
- The Society will pass on the full 0.25% Bank Rate change to all members who received a 0.25% decrease as a result of the August 2016 Bank Rate change.
- This includes popular products such as Loyalty Saver, Flexclusive ISA and children’s products such as Smart Junior ISA.
Should the Bank of England announce a 0.25% rise in Bank Rate on 2 November 2017, the changes to existing customer mortgage and savings rates linked to the Bank Rate change will be effective from 1 December 2017.
Chris Rhodes, Executive Director of Products and Propositions, said: “With a Bank Rate rise anticipated, we have decided to take early steps to offer improved mortgage products, while at the same time announcing the impact on members’ mortgages and savings rates. This is to give clarity to our members and ensure that we can continue to offer good value for both mortgage and savings. Savers in some of our most popular products, such as Loyalty Saver and Flexclusive ISA, will benefit if Bank Rate increases.”