Nationwide 10 year fix - existing customer question

Flat_Eric

I've been reading about the Nationwide 10 year fix mortgage deal that has been reported in the press this week.


We currently have our mortgage with Nationwide and are not tied into any "fix" or other "deal" at the moment.


I'm a bit in the dark about how it would all work if we decided to sign up for the 10 year fix.


Is it simply the case that we tell them we want to sign up and pay the product fee - or is the case that we go through the remortgage process, pay solicitors fees etc? does the product fee get added to the mortgage or is it paid cash in hand upfront?

MABLE

Flat_Eric wrote: »

I've been reading about the Nationwide 10 year fix mortgage deal that has been reported in the press this week.


We currently have our mortgage with Nationwide and are not tied into any "fix" or other "deal" at the moment.


I'm a bit in the dark about how it would all work if we decided to sign up for the 10 year fix.


Is it simply the case that we tell them we want to sign up and pay the product fee - or is the case that we go through the remortgage process, pay solicitors fees etc? does the product fee get added to the mortgage or is it paid cash in hand upfront?

If registered for online banking can be done all online. If not just phone them. Also fees can get added to the loan and there are no solicitor fees included in the fix.

However make sure it is really what you want. We signed up for a 10 year fix with NW at 4.89 percent and at that time was a good rate. However with hindsight not so brilliant. In the end we paid the mortgage off early with penalty of £99.

amnblog

You would ask them and they would apply the rate, assuming of course you have 10 years minimum left to run and have no arrears.


Be careful as 10 years is a long time to commit yourself to a product with hefty early exit penalties.

lee111s

Have you considered a switch to a tracker for now, interest rates are unlikely to change for a while.

With their trackers they give you the option to switch and fix at anytime with no penalties

rich_b

I've just spoken to Nationwide about this one myself as it happens (the 10yr 2.84% deal). As MABLE above mentioned, they confirmed that the £999 booking was the only fee payable. No legal, valuation or any other fee (I'm an existing customer, remortaging - it may differ for others). I was actually quite surprised, but then it's been years since I had to deal with arranging a mortgage. It could be added to the loan or paid seperately.

Interestingly, it works out cheaper in my case (£180k mortgage balance) to add the fee on the 2.84% deal than go for the 2.94% deal with no fee.

I also asked about the repayment penalties as I wasn't clear from their website how this works. The repayment penalty is a percentage (7% in year 1) of the remaining balance you wish to overpay on. The 10% max repayment allowed per year is 10% of the amount originally borrowed.

I'm stuck - happy on the BMR, considering the First Direct 1.79% lifetime tracker but not convinced by the longer term risk, now thinking that for only 0.34% over my current deal extra I can have 10 years of security at a very affordable rate which might outweigh the short-medium term savings from staying on a slightly lower rate. I'd be interested to hear which way you decide to go.

JOBEN

I'm thinking about taking the 10 year fix too but the exit fees are quite hefty and you never know what's going to happen so think I may opt for the 5 year fix instead which is just .04% higher then what I'm paying now anyway on most of my outstanding balance (base rate plus 2%)

Spangled

I'm sure one of the main banks recently launched a 10-year fix but there are only early repayment charges in the first 5 years. Which, for some people, means the best of both worlds - long-term security of a fixed rate but one that doesn't tie you in forever. But I can't for the life of me remember which bank it was!

topcat007

Spangled wrote: »

I'm sure one of the main banks recently launched a 10-year fix but there are only early repayment charges in the first 5 years. Which, for some people, means the best of both worlds - long-term security of a fixed rate but one that doesn't tie you in forever. But I can't for the life of me remember which bank it was!

It was tsb 3.44% on a LTV of 60%

tkane

MABLE wrote: »

If registered for online banking can be done all online. If not just phone them. Also fees can get added to the loan and there are no solicitor fees included in the fix.

However make sure it is really what you want. We signed up for a 10 year fix with NW at 4.89 percent and at that time was a good rate. However with hindsight not so brilliant. In the end we paid the mortgage off early with penalty of £99.

I know it's rather silly to try and predict what will happen in the future but a 10 year fix at 2.99% is just ridiculously good.

How much lower can it go? Not much, IMO.

Flat_Eric

Thanks for all the replies. Really helpful. :T

I haven't made a definite decision yet but my gut reaction is fixing for 10 years isn't for me.

FormulaDriven

IGNORE THE FOLLOWING, AS I'VE STARTED A NEW THREAD ABOUT IT. (Thread title "Nationwide: do they do affordability check if just switching from BMR to fix?")

This thread is helpful to me as I'm also on the Nationwide BMR at the moment, but the fixes (5y and 10y) now look very attractive. A question just to clarify: if I switch to a fix, do I understand that the process is quite straightforward, ie if you are not borrowing more then there is no underwriting involved or will they need:
a) evidence of house value (for LTV)?
b) evidence of earnings (for affordability checks)?
I can produce these, but obviously it makes the whole thing much more onerous (and a risk of being declined, I suppose).