Support for long term fixed rate mortgages welcomed

Nationwide Building Society today welcomed the news that Chancellor Alistair Darling wants to increase the availability of long term fixed rate mortgages in the market.

In a speech made at the EEF manufacturer's biennial dinner in London, the Chancellor announced that plans to encourage more lenders to offer mortgages fixed for longer periods would be outlined in his first budget next month.

Nationwide, the UK's second largest mortgage lender remains the only major high street provider to offer a 25 year fixed rate mortgage, with an option to switch after 10 years. The Society initially launched a 25 year fixed mortgage in March last year, which proved to be so popular with borrowers that it sold out in just five weeks. Since July last year the Society has offered the product as a regular feature in its range. The Society's experience is that the 25-year fixed rate has a place in the market and offers long-term stability for borrowers who want to protect against fluctuations in interest rates.

In addition, Nationwide recognises that people who want a mortgage for life don't necessarily want a house for life which is why its 25 year mortgage is fully portable, allowing borrowers to take it with them as they move up the property ladder.

Features of Nationwide's 25 year fixed rate mortgage include:

Rate from 5.98%
No Early Repayment Charges after the first 10 years (3% during first 10 years)
Flexibility: the ability to overpay (by up to £500 per month), underpay and take payment holidays
Portability: as with all Nationwide mortgages, borrowers can take it with them when they move home and top it up with an additional loan if they wish to move to a larger property
Saving on fees: with only one arrangement fee, borrowers could save hundreds and in some cases, thousands of pounds on fees, over the term of their mortgage
Security: protect against potential interest rate rises with fixed payments
Simplicity: no need to choose and arrange a new deal every few years
Reservation fee of £599
Available to both home movers and remortgagors
No higher lending charge on any Nationwide mortgages