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Nationwide – 2 Year Fixed Rate Mortgage


2-Year Fixed Rate Mortgage

Type: Fixed-rate mortgage

Fixed term: Two years

Fixed rate: Up to 95% of valuation 5.49%, up to 90% of valuation
5.09%, up to 75% of valuation 4.99%

Minimum loan: £1

Maximum loan: Up to 95% of valuation subject to a maximum of
£200,000, up to 90% of valuation subject to a maximum of £300,000,
up to 85% of valuation subject to a maximum of £400,000, up to 80%
of valuation subject to a maximum of £700,000, up to 75% of
valuation subject to a maximum of £1m

Income multiples: Based on affordability calculation for individual

Conditions: 12 months&#39 free mortgage payment protection insurance

Arrangement fee: £185

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

Redemption fee: 2% of outstanding loan in year one, 1% in year two
Introducer&#39s fee: Subject to negotiation

Tel: 0800 302010

Nationwide&#39s 2-year fixed-rate mortgage is available with a fixed rate
of between 4.99% and 5.49%, depending on loan to valuation. It also
has flexible features such as overpayments, underpayments,
payment holidays and the daily calculation of interest.

Priestfield Webber proprietor Malcolm Martin believes this mortgage
will appeal to people who fear an interest rate rise over the next two
years. He says: “This is a flexible mortgage that allows overpayments
to a maximum of £500 a month without incurring any early
redemption costs. The reservation fee of £185 is keenly priced and
should not deter new customers from applying for this scheme.”

In Martin&#39s view, a major incentive for new borrowers to take out this
mortgage is the pledge from Nationwide that it is available to existing
borrowers and that it will be possible to arrange a further new
mortgage product with Nationwide at the end of the term.

He also feels the rate of 4.99 per cent is attractive in today&#39s market
but only applies to a maximum loan to valuation of 75 per cent. He
adds: “For borrowers who want to arrange a mortgage in excess of
90 per cent of valuation, then the rate of 5.49 per cent does not look
so attractive when compared with discount rates available

Considering which deals are likely to provide the main competition
for Nationwide, Martin concludes: “For high loan to valuation
customers, the Woolwich discounted rate of 3.79 per cent looks
exceptional value. The Woolwich fixed rate of 4.99 per cent for two
years applies for loans up to 95 per cent of valuation.”


Suitability to market: Good

Competitiveness of mortgage rate: Good

Adviser remuneration: Average

Overall 7/10


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