View more on these topics

Leading potential from Nationwide


Two-Year Fixed With Fee

Type: Fixed rate mortgage

Fixed term: Two years

Fixed rate: Loans up to 95% of valuation – 6.95%, up to 90% of valuation – 6.45%, up to 75% of valuation – 6.25%

Minimum loan: £25,000

Maximum loan: Up to 95% of valuation subject to a maximum of £500,000, up to 85% of valuation subject to a maximum of £1m

Income multiples: Based on affordability

Conditions: Loan up to 95% of valuation for existing borrowers only

Flexible features: Overpayments up to £500 a month, underpayments, payment holidays, lump sum withdrawals, interest calculated daily

Arrangement fee: £599, £299 for first-time buyers

Redemption fee: 1.5% of the amount repaid in the first

Introducer’s fee: Refer to lender


This Nationwide two-year fixed deal comprises a range of rates depending on the maximum LTV, with the 95 per cent rate available only to existing borrowers.

London & Country technical manager Richard Morea says: “The rates on offer to homebuyers are 6.25 per cent for loans up to 75 per cent LTV, 6.45 per cent up to 90 per cent LTV and 6.95 per cent for loans to existing borrowers only up to 95 per cent.

“This latest range is unlikely to cause a stir as the recent reprice by Nationwide has placed the rates some way off the market leaders. However, in this fast paced market and with most lenders not having repriced recently, it won’t be long before they are more competitive,” he says.

Morea notes that these fixed rates all carry a reservation fee of £599, which is reduced to £299 for first time buyers, “However there is a separate range with higher rates, which carry no fee. The schemes are all portable but if this is not feasible, the early redemption charges during the fixed period are low at 1.5 per cent of the amount repaid.

Discussing the potential drawbacks of the Nationwide rates, Morea says: “Overall these are good products with a degree of flexibility from a good lender, but for the moment they are let down by the rate.”

According to Morea, there are a number of two-year fixed rates that will comfortably beat Nationwide on price. He suggests First Direct, which has a 5.49 per cent two-year fix up to 80 per cent of valuation. Loughborough at 5.75 per cent to 90 per cent LTV and RBS at 5.99 per cent to 75 per cent LTV are also seen as the main competitors. Morea adds that most of these deals have similar fees.

Morea concludes: “Further competition will come from longer term fixed rates as borrowers look for greater peace of mind, while they no longer have to pay a large premium to get it. “


Suitability to market: Good
Competitiveness of rate: Average
Flexibility: Average
Adviser remuneration: Average

Overall 7/10


Moratorium extended on genetic test results

The Association of British Insurers has extended until 2014 the moratorium enabling consumers to take out substantial amounts of insurance without having to disclose adverse res-ults of predictive genetic tests.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm