Nationwide Mortgage

Yorkieand

I have my mortgage with Nationwide in two parts. Both have come off a 5 year fixed rate at the end of December and are now on trackers at 2.88% (BR+0.88%).

The original part of the mortgage is, according to my statement, on the Budget Plan Scheme. Apparantely payments are only changed in February each year. I had forgotten all about this having been on the fixed rate for all those years.

My question is, if interest rates were to go up over the next 12 months and because my payments are staying the same, would I then be in arrears which would be accounted for when next Februarys payment is set? Or do the Nationwide effectivly "fix" your rate for the twelve months and then do the same again year on year, accepting that some years they will lose and some they will gain?

I hope someone understands what I'm trying to say and can advise accordingly.

Thanks

Gorgeous_George

The base rate is 1.5% so you are only paying 2.38%.

If rates went up, you would owe more next February but it wouldn't be arrears. Nationwide would amend your payments to reflect the new balance. In the meantime, you could ask for your direct debit to be increased at any time to avoid the balance increasing.



GG

UniEagle

Nationwide have a floor of 2% on their mortgages, so 2.88% is correct in this case. As I understand it, they will adjust your payments next year to reflect the remaining amount left to pay off. So if the rates rise then next year you'll have more to pay off still.

dimbo61

You could also ask for you mortgage payment to remain static at the old rate that you have been paying for the last five years and therefore overpay each month.

gerdo

Do you mind if I ask how you managed to get such a good rate on your tracker? My Nationwide fixed rate ends at the end of this month but I'm just going onto the SVR as there were no other good deals available.

Yorkieand

Thanks for the comments everyone.

gerdo, my fixed rate ended in December but I made an appointment at my local branch sometime in October and reserved a lifetime tracker to start from January, when it was still BR+0.88%. Infact I was slightly disappointed at the time as the trackers had just gone up by about 0.25% on the very day of my appointment. I can now see however that I was actually very lucky bearing in mind how things have turned out since.