The UK’s largest building society has cut its cheapest mortgage interest rate to its lowest level in eight months and significantly below the Bank of England’s base rate.
From Wednesday, Nationwide will offer new remortgage customers 3.84% on a five-year fixed deal.
Existing mortgage holders can get a lower rate on add-on loans and conversion deals, as well as on five-year offers.
New members and first-time buyers can get a slightly higher five-year fixed rate of 3.85%.
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As well as being lower than the Bank of England Base rate 5.25%That offer is also lower than the current average interest rate on a five-year mortgage, which stood at 5.2% on Tuesday, according to financial information firm Moneyfacts.
Henry Jordan, Home Director at Nationwide Building Society, said: “These latest changes mean we are now offering rates below 4% for the first time in eight months.”
But another bank, Santander, is increasing interest rates on some of its mortgage products.
It said a number of standard residential fixed rates would rise by up to 0.2% for purchase and remortgage customers.
A Santander spokesman said: “Santander continually reviews interest rates based on a number of factors, such as wider market conditions including swap rates.
“We offer a range of competitive mortgage deals with five-year offers starting from 3.99% and two-year deals starting from 4.25%.”
Mortgage rates were In the summer it rose up 6% for typical fixed deals but decreased In the past four months, the decline in the pace of inflation has led markets to adjust their expectations about when the bank will cut the key interest rate.
Both the base rate and market expectations influence the mortgage products offered to consumers.
The Bank of England raised interest rates 14 times in a row Trying to tame The pace of price increases doubled This follows the energy crisis when Russia invaded Ukraine.
Banks and building societies can vary rates based on a variety of factors including how much interest there is in a particular offer and whether mortgage holders may be looking to switch at this time of year or new potential buyers may be looking at them.