Nationwide making drop lock ption unrealistic?

zippitydoodah

I'm with the Nationwide on a tracker mortgage for the next 32 months, or so. Currently the rate is 2.74%. So far, so good.

For peace of mind I would like a 10 year fixed rate as I can see rates increasing significantly after the next 12-18 months. I do have the drop lock option but so far the Nationwide is offering an uncompetitive 5 year fixed rate of 4.98 (others are offering 3.95%) and no 10 year fixes (Leeds is offering 4.75%). I really don't want a 5 year fix as my mortgage will still be over £100,000 in 5 years time and I don't fancy a possible rate of 8% or 9% on that amount in 2014!

Do you think Natiowide is purposefully making their 5 year fixes uncompetitive and withdrawing their 10 year fixes as they don't really want people taking this drop lock option? How long should I wait before I pay the early repayment charge and go elsewhere? Or when the quantitive easing kicks in, is Nationwide, like others, likely to offer tempting long term fixes of 10 years or more?

essexsi_2

Hi zippitydoodah.
Not really any advice, but I am in exactly the same position as yourself. I believe as you do that interest rates may be on the up.
I have a NW lifetime tracker of BOE+0.88, so currently sitting at 2.88% and will not go any lower due to their collar. This would make a long term fix, preferably 10 years, very attractive to me. Especially if it started with a 3!!!
I was going to start a separate thread on when people on here think that Nationwide will offer 10 year fixes again. Hopefully they will look in on this thread.

Cheers Si

tcaratella

Hi, i have just got off the phone to nationwide and they have told me i cant come out of my 5 year fixed rate of 5.63% (3 and a half years left to go). When the rates dropped i called early in the year and the actually told me i would need to pay £3000 for my erc. Now they are saying they are not allowing customers to move from fixed rates at all and wil have to let them expire naturally. I AM FURIOUS :mad: because the advisor at the time said i could move, would thy still honour it as there might be confusion with members of staff about what regulations are in force at what time, mmmmm anyway if anyone else is in the same boat, please share. i really dont want to keep paying 5.63% for an another 3 1/2 yrs when i could be paying half!!! AAGGGHHH!!

SmileyG_2

tcaratella wrote: »

Hi, i have just got off the phone to nationwide and they have told me i cant come out of my 5 year fixed rate of 5.63% (3 and a half years left to go). When the rates dropped i called early in the year and the actually told me i would need to pay £3000 for my erc. Now they are saying they are not allowing customers to move from fixed rates at all and wil have to let them expire naturally. I AM FURIOUS :mad: because the advisor at the time said i could move, would thy still honour it as there might be confusion with members of staff about what regulations are in force at what time, mmmmm anyway if anyone else is in the same boat, please share. i really dont want to keep paying 5.63% for an another 3 1/2 yrs when i could be paying half!!! AAGGGHHH!!

I'm 2.5 years into a 5 year fix with Nationwide at 5.18%

Point 1: It's what I signed up for (read my KFI)
Point 2: No one is being offerred the SVR of 2.5% at the moment as a option, it's just the default rate (x years at y% followed by the SVR of z%)
Point 3: Why does everybody expect the fixed rate option to be a one way bet in favour of the borrower? It ain't!

SmileyG