The Nationwide is one of the leading mortgage lenders and offers a range of mortgages for first time buyers, existing customers and those looking for remortgage deals. Fixed or tracker interest rates are available.
Fixed or tracker mortgages are available from the Nationwide. Fixed mortgages carry a fixed interest rate for the first years of the mortgage. The rate for tracker mortgages is linked to the Bank of England base rate, and moves up or down with that base rate. From April 2009 onward, fixed and tracker rate mortgages revert to the Standard Mortgage Rate (SMR) when the fixed or tracker term ends. The Nationwide does not have any cap on the level to which this SMR could rise. Before April 2009, the Base Mortgage Rate (BMR) applied, but from April 2009 this is only relevant for mortgages that were already on the BMR before April 2009. Where a mortgage is on the SMR unlimited, overpayments may be made to reduce the outstanding balance on the mortgage. The amount that can be borrowed depends on the income and outgoings of the borrower, the credit score, the percentage of property value being borrowed and on whether the nature of the property.
Nationwide mortgages may be repayment or interest only. The repayment mortgage requires payment of interest and a part of the balance of the mortgage each month, whereas an interest-only mortgage requires payments just in respect of interest without repayment of any of the balance outstanding on the mortgage. Where an interest-only mortgage is chosen, the borrower must make provision for repayment of the mortgage at the end of the term, by building up funds in a separate product, such as an individual savings account (ISA). New Nationwide customers may only take out an interest-only mortgage if they are borrowing 75% or less of the value of the house, otherwise they must choose a repayment mortgage. If existing customers want to increase their borrowing to more than 75% of the value of their property, they must do so on a repayment basis. If they decide to take out a new mortgage for more than 75% of the property, the whole mortgage must be on a repayment basis. Product and booking fees apply to mortgage applications. There may be special offers at times, for example reduced product fees on certain mortgages or reduced or nil legal fees for valuations in certain cases.
The Nationwide offers mortgage deals for the Buy to Let market through its specialist lender The Mortgage Works. Nationwide also has a commercial lending section that may arrange loans of £1 million or more in the retail, commercial and industrial sectors.