Nationwide loans: building society doubles personal loan limit to £50,000 amid rising building costs - rates
Nationwide Building Society has increased its maximum personal loan offering to £50,000, citing the ongoing surge in building costs as the driving factor behind the adjustment.
Previously, the society provided up to £25,000 for eligible customers, but found this insufficient for certain home improvement projects.
Research conducted by Nationwide revealed that half of individuals undertaking building projects had to scale back or postpone their plans due to financial constraints.
With construction costs projected to climb by another 15% over the next five years, more people are anticipated to face significant expenses.
The expanded loan amount is accessible to Nationwide current account holders who meet the affordability criteria, and interest rates will vary based on the individual's circumstances.
The representative Annual Percentage Rate (APR), which at least 51% of borrowers will encounter, stands at 7.9% for loans ranging from £25,001 to £35,000, and 8.9% for loans between £35,001 and £50,000.
Loans can be structured over a period of one to seven years, with no penalty for early repayment. Nationwide joins other financial institutions like HSBC, First Direct, NatWest, and Shawbrook in offering such sizeable loans, although they remain in the minority.
Andrew Hagger, a personal finance expert at website Money Comms, told The Guardian: “I think it’s a sign of the times that you can now apply for a £50,000 unsecured loan – it may be more expensive than a mortgage further advance rate wise, but way quicker to arrange plus no fees to worry about and no early repayment charge either.”
While Nationwide attributes the loan increase to escalating building costs, applications will also be considered for various purposes.
Darren Bailey, the head of personal loans at Nationwide, said: “Whether you’re looking to fund home improvements, a new car or consolidate existing debts, we’ll be able to meet more of our customers’ borrowing needs.”
When questioned about how Nationwide ensures borrowers avoid taking on excessive debt, Bailey said: “As a responsible lender it is important we make sure customers don’t overstretch themselves.
“Each loan application is individually assessed to make sure people can afford the repayments alongside their existing and any future outgoings.
“Those applying for a personal loan can get a soft quote which advises them if they are likely to be accepted and at what APR without impacting their credit file, allowing them to make an informed borrowing decision.”
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