Loyalty mortgage rates are being used to retain customers.

In an effort to keep existing customers, preferential loyalty mortgage rates are being released by an increasing number of UK lenders.

Currently many lenders have aggressive remortgaging campaigns which are being used to lure mortgage-holders to switch from rival lenders.

Those lenders wanting to keep existing borrowers are therefore offering lower loyalty mortgage rates to those home-owners who stay and take on additional borrowing.

Nationwide are one such lender to announce the launch of preferential rates. It has said that it wants to show its customers that their loyalty will be rewarded. Any mortgage holder taking on additional borrowing will be offered a reduced rate.

Barclays has also cuts its existing customer rates, lower rates will be offered for those who remain with the lender and increase their borrowing.

Lenders such as Lloyds TSB are using alternative customer incentives, it is offering its current account customers a 0.2% rate reduction if they take on a mortgage. Other lenders such as the Coventry Building Society are offering remortgages with low fees and free valuations.

Remortgage incentives such as loyalty mortgage rates and fee free deals are useful, however it is vital to ensure that the overall mortgage offered is the most competitive available for your circumstances.

You are recommended to compare your lender's loyalty mortgage rate with the wider market to see if it is worth sticking with. Deal Direct can review the market on your behalf, we can find you the most competitive offer available and help you switch.

 Why pay more for your mortgage than you have to?

 Contact an adviser today.