Nationwide announces major mortgage shakeup with interest rate changes

The move has seen the cost of borrowing brought down and banks and lenders including Nationwide now offering customers more favourable rates.

Nationwide announced that effective today, (February 21) it will be slashing them by as much 0.33%, as per Liverpool Echo.

The retail bank is currently offering the following mortgage products for new customers moving home.

• Five-year fixed rate at 60% LTV with a £1,499 fee is 4.09% (0.05% reduction)
• Five-year fixed rate at 85% LTV with a £999 fee is 4.45% (0.13% reduction)
• Three-year fixed rate at 75% LTV with a £999 fee is 4.34% (0.05% reduction)
• Two-year fixed rate 75% LTV with a £1,499 fee is 4.24% (0.13% reduction)
• Two-year fixed rate 95% LTV with no fee is 5.42% (0.22% reduction)

The mortgage products open to first-time buyers are:

• Three-year fixed rate at 60% LTV with a £999 fee is 4.29% (reduced by 0.05%)
• Three-year fixed rate at 85% LTV with a £999 fee is 4.64 per cent (0.05 per cent reduction)
• Two-year fixed rate at 80% LTV with a £999 fee is 4.50 per cent (0.33 per cent reduction)
• Two-year fixed rate at 95% LTV with a £999 fee is 5.29 per cent (0.25 per cent reduction).

Nationwide’s senior manager for mortgages, Carlo Pileggi, said: “As one of the UK’s largest lenders, we remain as committed as ever to supporting home movers and first-time buyers, with these reductions following our cuts for remortgage and switcher customers last week.

“These latest reductions bring five-year and two-year fixed rates closer together, with our first-time buyer £999 fee products fully aligned across both terms,” added.

“We now have some of the most competitive rates on the market, whether it be for first-time buyers or customers moving home.”

However, experts warn mortgage interest cuts made by lenders in recent weeks may not last long as lenders adjust to the market shift.

Harps Garcha, director at Brooklyns Financial said: “Wednesday’s unexpected rise in inflation has tempered predicted base rate cuts in 2025. With swap rates reacting sharply, recent mortgage rate reductions may be short-lived.

“Those looking to secure new a fixed rate for their mortgage should consider acting sooner rather than later before lenders adjust rates in response to the shifting market.”