Nationwide Building Society is today announcing that it will pass on the full 0.50% reduction in the Bank of England Bank Rate.
Nationwide Building Society is today announcing that it will pass on a further 0.15% reduction to existing variable rate borrowers to reflect the back-to-back cuts made to the Bank of England Bank Rate. This latest announcement follows on from the Society confirming it would pass on the initial 0.50% reduction to borrowers from 1 April.
As a result, with Bank Rate now at an historic low of 0.10%, Nationwide’s Base Mortgage Rate (BMR) and Standard Mortgage Rate (SMR) will reduce by an additional 0.15% to 2.10% and 3.59% respectively, with these new rates coming into effect on 15 April.
Borrowers on an existing tracker rate mortgage will also see their rates reduce by a further 0.15%.
The Society’s BMR remains one of the lowest revert to rates in the market, with estimates suggesting that compared to the average standard variable rate charged by other major lenders, around 281,000 BMR borrowers have benefitted from a saving of around £500 per year.
Henry Jordan, Nationwide’s Director of Mortgages, said: “With a second cut in interest rates in just over a week, it is important that borrowers have clarity about what this second change means for them and the future interest and payments on their mortgages. By passing on this latest rate reduction in full, from 15 April, we hope to minimise mortgage costs for our members during this difficult period.”
This latest announcement follows on from the Society outlining a range of considered support options for members financially impacted by coronavirus, including self-certified mortgage payment breaks.
Henry Jordan continued: “We understand the concern our members are feeling at the moment, including homeowners. As a member-owned organisation, we want to ensure we are able to continue offering our usual high standard of service at the same time as helping all our members through what is an uncertain period.
“As such, we recently announced a range of support options for members financially impacted by coronavirus, including mortgage payment holidays, which can now be applied for online. While we continue to work hard with valuation and conveyancing partners to progress applications, we ask members and brokers to bear with us during what is an unprecedented period.”
With two Bank Rate cuts within nine days, the Society is continuing to review its savings rates and will make an announcement on the impact of both Bank Rate changes on its savings range in due course.
Tracker mortgages
On Wednesday 25 March, Nationwide will also be re-introducing two-year tracker mortgages to its range covering a variety of LTVs and with both £0 and £999 fee options. For house purchase and first time buyer tracker products, rates will start from Bank Rate plus 1.39%, while remortgage tracker products will start from Bank Rate plus 1.19%.
Henry Jordan said: “With two cuts in interest rates in just over a week, we took the prudent decision to carefully consider the impact on our mortgage range. However, as the UK’s second largest mortgage lender, it is important the Society continues to offer members a range of options, while also ensuring we continue to maintain our high levels of service. We are re-introducing two-year trackers to our mortgage range to enable us to offer products with flexibility and no early repayment charges.”
