Nationwide launch new variable rate mortgage

In an announcement made earlier this morning, the Nationwide has announced the launch of a new variable rate mortgage product priced at 3.99%. The new product will be available from Thursday with further details of fees and charged yet to be advised. The new product will be know and the Standard Mortgage Rate, and will also be the reversionary rate which applies to all Nationwide mortgages applied for after Thursday.

The move by the Nationwide has not been unexpected as is seen as a direct result of the historically low bank rate. Unlike many mortgage lenders, the Nationwide have always promised that customers on their standard variable rate would enjoy an interest rate which would be no more than 2% above the prevailing Bank of England base rate. Whilst this was an easy promise to keep in the past, it has become more and more difficult as interest rates have fallen. The current standard variable rate will be known at the Base Mortgage Rate, and will be available only as a reversionary rate to existing customers or those who apply before Thursday.

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