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Saturday 07th of November 2009
August 4, 2009    

Nationwide cuts rates by 0.5%

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by Gill Montia

Nationwide has cut rates by up to 0.5% on some of its fixed-rate and tracker mortgages, from today.

Reductions have been applied to its two-year and three-year fixed-rate loans and two-year tracker deal, both for new customers and remortgagers.

However, also from 4th August the building society will be retaining £99 of its existing reservation fees, having introduced a non refundable booking fee that cannot be added to the loan.

The change doesn’t apply to further advance applications or switcher packages and overall, charges have not increased as the £99 is deducted from the final arrangement fee on completion of the mortgage.

Mortgage rates have been rising steadily in recent weeks as lenders look to their margins, which have risen from an average 0.5% above the Bank of England’s base rate to 2.61% in the past 12 months.

Last week, Chancellor of the Exchequer Alistair Darling threatened to refer banks to the Competition Commission if they fail to pass on rate cuts and it will be interesting to see if Nationwide has begun a trend.

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