Once your mortgage has come to the end of its deal period you'll be placed onto the current standard variable rate (SVR) as a Nationwide Building Society customer. With the Nationwide there are no direct SVR type mortgages you can currently take out as the initial rates offered are either fixed or under a tracker type product.
The current standard variable rate for Nationwide Building Society Mortgages is 3.74% which is one of the highest in the industry. Mortgages reserved before 29th April 2009 will revert to the Base Mortgage Rate (BMR) and subsequent mortgage reservations revert to the standard mortgage rate (SMR).
The BMR is guaranteed not to be higher that 2% above the Bank of England Base rate however if you move your mortgage now you will be placed on the SMR which has no upper limit or lower cap. The BMR is currently 2.25% and the SMR 3.74% - a big difference. So if you are currently on the BMR and thinking of moving your mortgage loan for whatever reason then it would be worth taking professional advice on this matter because once you have moved from the current BMR to a new product it is not possible to switch back at a later date which could cost thousands in interest payments.
Although an initial tracker or fixed mortgage interest rate may sound enticing it's the standard variable rate you are placed on afterwards which may be the most important as this is where most mortgages end up and where many people are at this moment in time.
If your circumstances change between when you take out a product to when it gets renewed several years later then you may not be in a position to get similar terms. For example, if you lose your job or you have a child and one parent does not work any longer.
That's just the reason why lenders publish an APR because this takes into account the initial generally discounted rate as well as the SVR for the term of the mortgage loan.
Whilst the initial rates offered by Nationwide Building Society are actually some of the best deals in the industry and market place you should perhaps consider not only the arrangement fees that are now charged by all lenders, the repayment penalties if you decide to pay off your loan or have to move house but also the standard variable rate you may have to pay if you don't remortgage once your deal period has completed.
With so many products on the market and with the Nationwide Building Society it may be easy to choose the lowest headline rate but once you have added in arrangement fees and any additional charges the rates offered by all companies including Nationwide Building Society may push up the actual cost of the mortgage. Therefore it may be prudent to either use a comparison website and certainly to get professional advice to help your decision making process.
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