Nationwide Cuts Rates

Mortgage Rate For Many Existing Borrowers Hits 41 Year Low

Nationwide Building Society today announces a reduction in its Base Mortgage Rate of 0.25% to 5.99% for both new and existing borrowers from 1 June. On the same date Nationwide's Standard Variable Rate will also be reduced by 0.25% to 6.49%. These moves follow today’s announcement that the Bank of England base rate has been cut by 0.25%.

Nationwide's Base Mortgage Rate will be the lowest rate paid by a substantial proportion of its existing borrowers since May 1960 - more than 41 years ago. The BMR is guaranteed to be no more than 2% above the Bank of England base rate, the current difference being just 0.74%, and the SVR is capped at 0.50% above the BMR.

The reduction of 0.25% will save borrowers with a £60,000 interest only mortgage £12.50 per month. It also means that Nationwide's Base Mortgage Rate and Standard Variable Rate will both continue to be substantially lower than the standard variable rates of most other high street lenders. For example, many Halifax borrowers will still be paying interest charged on an annual basis at a rate of 7.00%. On a £60,000 interest only mortgage, a borrower with Halifax would pay £606 more than a similar Nationwide borrower in just one year.

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