Nationwide: does it again and raises its mortgage rates

October 21. Nationwide the UK’s biggest building society announced today that they were increasing the rates on their Tracker Mortgage products. This is the second raise by Nationwide in just over a week, providing further evidence that the Bank of England Base rate cut has done nothing to make mortgage rates cheaper in Britain.

Nationwide’s tracker deals are being affected again with an increase of between 0.24 percent and 0.6 percent, the tracker rates are pegged to the Bank of England’s base rate.

It was only Tuesday last week that Nationwide hiked up the price of its tracker mortgage rates adding 0.3 percent to the cost. The second round of new rate changes will come into effect from tomorrow. This will mean a Nationwide three-year tracker deal for someone with a 40 percent deposit last Monday would have cost them 5.64 percent but will now with the increase cost them 6.18 percent.

The hardest hit will be the borrowers who have smaller deposits, with up to 0.6 percent added onto some of Nationwide’s tracker rates on large loans. For instance on Nationwide’s lifetime tracker deal, if you have less than 25 percent deposit, the new rate will be tracked at 2.03 percent above the base rate which is at 4.5 percent giving you a Tracker rate of 6.53 percent, the rate is currently being tracked at 1.43 percent over the base rate at a tracker rate of 5.93 percent.

The margin on the three-year tracker deal will change from 1.49 percent to 2.08 percent with deposits between 10 percent and 15 percent.

Source: Guardian