Nationwide reintroduces 95% mortgage

| December 17, 2008 | 0 Comments
Nationwide reintroduces 95% mortgage

Nationwide Building Society has reintroduced a mortgage with a 95% loan-to-value ratio (LTV).

The deal is only available to existing customers who are moving house and borrowers signing up for the loan will be on a two-year fix at 7.18% for the no fee version.

The minimum loan size is £25,000 and for those prepared to pay a fee of £599 the rate goes down to 6.78%, or 6.68% with a fee of £995.

Home loans with up to 95% LTV have virtually disappeared over the past twelve months.

Lenders have become more risk aware and the danger of negative equity increased as house prices continued their downward trend.

The move by Nationwide can be interpreted as signs of recovery in the UK mortgage market but the rate is high, at 5.18% above base rate.

In addition the first-time buyers who are so desperately needed to kick-start the housing market and are likely to be seeking a high LTV, are excluded from the deal.

The building society has also launched a two-year tracker mortgage at 5.49% with a 60% LTV and a promise that the rate will fall to 4.49% from January of next year.

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