The lowest five-year fixed rate mortgage has fallen below 4 per cent for the first time in five months, after Nationwide announced further cuts.

From today Britain's biggest building society will reduce rates by up to 0.25 percentage points across its two, three and five-year fixed rate products, with its lowest deal now standing at 3.99 per cent.

Nationwide's announcement follows in the wake of downward moves by HSBC this week and also mortgage rate cuts by Halifax, NatWest and TSB at the end of last week.

Nationwide has become the first major high street lender since February to return to offering a five-year fixed rate mortgage with a rate below 4 per cent.




Mortgages dip below 4%: Nationwide has made cuts across a number of its fixed term deals

The 3.99 per cent five-year fix is aimed at homebuyers with a deposit of at least 40 per cent. But, it also comes with a chunky £1,499 fee.

Someone securing this rate on a £200,000 mortgage being repaid over 25 years could expect to pay £1,055 a month.

When compared to the average five-year fix rate across the whole market of 5.4 per cent, according to Moneyfacts, this represents a £161 monthly saving. Borrowers will welcome fresh cuts to mortgage rates but most still face a jump in payments when it is time to remortgage.




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Nicholas Mendes, mortgage technical manager at broker John Charcol said: 'This is fantastic news for borrowers and signifies a significant change in the mortgage landscape after recent months of increased rates.

'This rate is for purchases only. Those remortgaging will need to wait a bit longer before we see rates below 4 per cent as well.

'We will likely see the likes of HSBC look to reprice again to ensure they remain ahead of the pack, potentially resulting in another quick reprice from them.

'Lenders have been busy competitively repricing against each other over the last fortnight, with purchase rates significantly lower than remortgage rates. 

'Purchase rates are highly competitive compared to market pricing. Expect the biggest future reductions to be in remortgage rates, as they still have room to decrease, and any significant reductions are expected in this area.'

What are the best mortgage rates on offer?
Nationwide's latest repricing opens up cheaper opportunities for not only home movers, but also for first-time buyers and those remortgaging.

Like with its deals aimed at home movers, Nationwide's best remortgage deals are aimed at homeowners with the biggest amounts of equity built up. 

Essentially this means someone needing a mortgage to cover no more than 60 per cent of the property's market value. 

Its best five-year fix is 4. Here is more on 30 year fixed rate mortgage calculator take a look at our web site. 27 per cent with a £1,499 fee. This will be the lowest rate on the market from tomorrow.




The only way is down: Halifax also cut rates last week in another piece of good news for borrowers

Those needing a mortgage to cover 75 per cent of a property's value, can also get top of the market deals with Nationwide.

Its lowest five-year fix at 75 per cent loan-to-value is 4.43 per cent with a £999 fee (second best) and its lowest two-year fix is 4.79 per cent (joint fourth best mortgage rates).

First-time buyers will be able to secure some top rates with Nationwide as well.