This move follows the recent announcement that the Bank of England base rate has been cut. In addition, lowest ever fixed rates and a new range of lower tracker rates are being introduced.
Nationwide's BMR will be the lowest rate paid by the majority of its existing borrowers since June 1955 - almost 50 years ago - and will remain around one percent lower than the standard variable rates of most other major high street lenders. Based on a £60,000 repayment mortgage, borrowers with Nationwide will save £426.72 over just one year by having their mortgage on the Nationwide BMR of 4.64% rather than the Halifax variable rate of 5.65% (see table 1).
Table 1: Savings to be made on BMR v’s SVRs of major lenders
Lender SVR / BMR Monthly payment Monthly saving with NBS Annual saving with NBS Saving over 7 years with NBS
Nationwide (NBS) 4.64% £338.29 - - -
Halifax 5.65% £373.85 £35.56 £426.72 £2,987.04
Abbey National 5.79% £378.92 £40.63 £487.56 £3,412.92
Northern Rock 5.69% £375.30 £37.01 £444.12 £3,108.84
Based on a £60,000 interest only mortgage at 75% loan to value. Correct as at 14 February 2003.
Nationwide’s lowest ever fixed rate mortgages, which will be available from 18 February, are:
· 2 year fixed rate available from 3.99% (decreased by 0.30%)
· 3 year fixed rate available from 4.29% (decreased by 0.30%)
· 5 year fixed rate available from 4.49% (decreased by 0.30%)
Nationwide is also launching a new range of tracker mortgages, which will be available from 18 February:
· 2 year tracker rates available from 3.74% (Base Rate minus 0.01%)
· 3 year tracker rates available from 3.84% (Base Rate plus 0.09%)
Nationwide's savings rates are being reviewed and an announcement will be made in due course.
Stuart Bernau, Nationwide executive director, said: “Our variable rate remains around one percent below our principal competitors and is supported by a very competitive range of fixed and tracker rates.
“Nationwide firmly believes fairness can work in the mortgage market. We have a competitive product range, our products remain available to both new and existing borrowers and are subject to daily interest, no MIG premiums and no extended tie-ins.”
