Nationwide introduce differential rates

Up until now, Nationwide has prided itself on offering ALL its customers an equally attractive deal and used this heavily in its advertising and marketing campaigns.

However, like its contemporaries, it must do what it can to initiate new business in today’s fiercely competitive mortgage market.

With this in mind, they now propose a deal whereby re-mortgagers will pay more than homebuyers.

From December, existing customers who wish to re-mortgage will pay somewhere between 0.1%-0.25% more than those rates charged to new customers buying a house.

In doing this, Nationwide will be far more in line with other lenders e.g. Halifax which typically charge existing customers a premium of around 0.4% over new customers.

Even with such a radical change in their deals, the products Nationwide offer are still extremely competitive in today’s markets.

A spokesperson for Nationwide denied they were making a u-turn in their policies and pointed out the difference was NOT between new and existing customers but rather between re-mortgagers and homebuyers.

Generally it is cheaper to retain an existing customer than take on a new client since procuration fees paid  by the lenders to brokers are moving towards retention commission. However Nationwide are removing the £99 re-mortgage fee for existing customers thus offering a re-mortgage for free.