Nationwide Building Society increases mortgage rates

Nationwide Building Society has re-priced its fixed-rate mortgages after increases in swap rates, which banks use to set mortgage rates.

Nationwide has also increased its base mortgage rate in the wake of the Bank of England's decision to up interest rates.

But while the Bank of England increased the UK's base rate by 0.25 per cent, Nationwide has increased its own bas mortgage rate by 0.35 per cent to 6.24 per cent. This new rate will come into effect on September 1st 2006.

From September 1st, Nationwide tracker mortgages will increase by 0.25 per cent - in line with the Bank of England rate hike. Nationwide's new two-year tracker rate mortgage is now available at 4.62 per cent, while the building society's lifetime tracker mortgage is available from 4.93 per cent.

The building society's new fixed-rate mortgage rates will come into effect on Tuesday August 15th 2006.

Nationwide's fixed deals are now as follows:

• Two-year fixed-rate (£699 fee): 5.09 per cent
  
• Two year fixed rate (£399 fee): 5.18 per cent
  
• Three year fixed rate (£399 fee): 5.38 per cent
  
• Five year fixed rate (£399 fee): 5.33 per cent
  
• Ten year fixed rate (£399 fee): 5.33 per cent

The rates above are for customers borrowing up to 90 per cent of the property's value.

However, Nationwide has increased the premium for borrowing from 0.3 per cent more than the underlying rate to 0.4 per cent.

Nationwide calculates interest on a daily basis on all products and does not impose a higher lending charge for high percentage borrowing.

A range of flexible features are available on all new Nationwide mortgages, offering the borrower the ability to overpay, underpay or take a payment holiday.