Nationwide Building Society is set to undercut Barclays by launching the lowest ever 10-year fixed rate.
From 21 January, the lender will offer existing mortgage customers a 60 per cent LTV 10-year fix at 2.84 per cent, having slashed the rate by 55 basis points. New customers will be offered a rate of 2.94 per cent, which will also be reduced by 0.55 per cent from 3.49 per cent.
The product will carry a £999 fee, reduced to £499 for first-time buyers. Remortgage borrowers will be offered a free standard valuation and a choice between free standard legal services or £250 cash back.
The move follows the launch of Barclays’ 2.99 per cent 10-year fixed rate earlier this month, which was then the lowest the market had ever seen.
Nationwide director of mortgages and savings Richard Napier says: “There has been a growing trend of customers opting for longer-term fixed rates to ensure certainty of monthly mortgage payment, particularly ahead of any rise in interest rates, with the recently-introduced 10-year fixed rate mortgages proving a popular addition to the range.”
Nationwide will also reduce rates across its 95 per cent LTV save to buy products by up to 35 basis points, with rates now starting at 4.44 per cent for a two-year fixed rate, though existing Nationwide borrowers are offered a further 10 basis point reduction.
A five-year fix to 95 per cent LTV will be offered at 5.19 per cent for new customers and 5.09 for existing borrowers.