The latest mortgage rate reduction from Nationwide is “really laying down the gauntlet” and challenging other lenders, according to John Charcol mortgage technical manager, Nicholas Mendes.
Mendes’ come after Nationwide announced it is reducing rates by up to 0.40 percentage points on its selected fixed and tracker rates across its product ranges.
This includes rates across its new business, switcher, additional borrowing and existing customers moving home product ranges.
Mendes commented: “Already offering market leading rates at 60 per cent and 75 per cent LTV, this latest reduction sees their higher LTV rates fall, further strengthening its hold in the market.”
He added that, as a result of the announcement, it will be “interesting” to see if there is any movement from other lenders such as HSBC, Virgin, or Coventry Building Society this week.
Nationwide’s reduction in its rates will take effect from today (October 3).
Sub-5% mortgages
Nationwide was not alone in announcing rate reductions however, as a number of major lenders have announced similar reductions and, following that, sub-5 per cent mortgage rates.
This includes Santander, HSBC, NatWest, Barclays and Halifax who all announced lower mortgages recently.
The latest lender to break the 5 per cent threshold is TSB who announced that, effective from today, it would be making reductions, with rates starting at 4.89 per cent.
TSB announced that its reductions would affect, among others, its residential mortgage products, with its 2 year fixed house purchase and remortgage 0-90 per cent LTV being reduced by up to 0.25 percentage points.
Additionally, its 5 year fixed house purchase and remortgage product was announced to be reduced by up to 0.30 percentage points.
Rate reductions were also announced to TSB’s product transfer products with 2 and 5 year fixed 0-90 per cent LTV dropping 0.35 percentage points and 3 year £995 fee by 0.10.
tom.dunstan@ft.com
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