Nationwide Building Society has cut mortgage rates on selected products, with some falling below 4% for the first time since February. The lender reduced rates by up to 0.25%, with the lowest five-year fixed rate now at 3.99%, making it the first major lender to offer a sub-4% five-year fix.
The cuts apply to home movers, first-time buyers, and remortgage customers. New customers moving home will see reductions of up to 0.23% on two-, three-, and five-year fixed products up to 95% loan-to-value (LTV). First-time buyers benefit from cuts of up to 0.24% on similar products, while remortgage customers get reductions of up to 0.17% on products up to 90% LTV.
Existing customers moving home also receive cuts of up to 0.23% on some fixed products up to 95% LTV, and additional borrowing rates on two-, three-, and five-year fixes up to 90% LTV are reduced by up to 0.25%. Switcher rates on selected products up to 95% LTV are cut by up to 0.25%, starting from 4.24%. However, the bank increased rates on selected two-year tracker products by 0.15%.
Henry Jordan, Nationwide's Director of Home, said: “As the country’s largest mutual, we want to maintain our support for all types of borrowers through attractively priced products.” Mortgage analyst Kylie-Ann Gatecliffe told the BBC the move could trigger a “rate war” among major lenders.
Average two-year fixed rates are currently around 6% and five-year rates at 5.39%, according to MoneyFacts. Despite the cuts, rates remain higher than the 16-year average. Some analysts predict the Bank of England will cut its base rate on August 1 due to falling inflation.
