Lenders continue to undercut each other amid intense competition
Almost a week after Barclays announced what was then the cheapest mortgage rate in the market at 3.84%, Nationwide has announced rate reductions of up to 20 basis points (bps), pulling down its lowest rate to 3.83%.
Effective from tomorrow, August 14, the lender is making mortgage rate cuts across its two-, three-, and five-year fixed rate mortgage products, with the new rates available to both new and existing customers looking to move home.
For new customers moving home, Nationwide is cutting rates by up to 16bps across its fixed rate products with loan-to-value (LTV) ratios of up to 95%. Notable reductions include a five-year fixed rate at 60% LTV with a £1,499 fee now set at 3.83%, and the same product with a £999 fee at 3.88%. A two-year fixed rate at 60% LTV with a £999 fee has been reduced to 4.35%.
Existing customers moving home will also see similar reductions, with rates mirroring those available to new customers. For instance, a five-year fixed rate at 60% LTV with a £1,499 fee has been lowered to 3.83%, while a two-year fixed rate at 60% LTV with a £999 fee is now 4.35%.
First-time buyers will benefit from reductions of up to 20bps across various fixed rate products. A five-year fixed rate at 60% LTV with a £999 fee has been reduced to 4.19%, while the same product at 85% LTV now sits at 4.46%.
Remortgage rates are being reduced by up to 18bps, with a five-year fixed rate at 75% LTV and no fee now available at 4.50%. Additionally, the two-year fixed rate at 60% LTV with a £999 fee has been cut to 4.57%.
Nationwide, which already slashed rates for its buy-to-let products through The Mortgage Works, is also adjusting rates for switcher products, with reductions of up to 20bps on selected two-, three-, and five-year options. Rates for these products now start from 4.06%.
The changes extend to additional borrowing rates, which are being cut by up to 19bps on fixed rate products up to 90% LTV, also starting at 4.06%.
According to Henry Jordan, Nationwide’s director of home, the rate reductions are part of the lender’s effort to support all segments of the market and “to ensure that Nationwide continues to be front of mind” for those looking to buy their first home, move to their next or who want to switch to a new deal.
The competition for market share has continued to intensify following the Bank of England’s recent rate cut. Last Wednesday, HSBC unveiled a new mortgage deal with a fixed interest rate below 4%. Barclays quickly responded with an even lower rate, surpassing recent offers from other major mortgage lenders.
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
