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Take the Natwest challenge – a deal you cant get

You may have seen the recent adverts proudly broadcast by NatWest, encouraging borrowers to take their ‘mortgage challenge’ and get £1,000 if you can find a mortgage cheaper elsewhere.

However, the phrase “there’s no such thing as a free lunch” describes their challenge perfectly, because NatWest is guaranteed to win every time.

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Here’s how:

• You have to be a customer of either Abbey, Halifax, Lloyds TSB, Woolwich, C&G or Barclays, and coming to the end of your current mortgage deal. The challenge is closed to everyone else.
• You have to find a mortgage with your lender cheaper than NatWest’s two year base rate tracker mortgage.

Here’s how the challenge stacks up:

As you can see from the comparison chart, NatWest cannot lose. Based on the monthly repayments of the deals from the four lenders that match the challenge criteria, the £1,000 challenge is little more than a marketing ploy to get borrowers through the door.

Nevertheless, it’s good to see a big bank throwing down the gauntlet to its competitors, rather than resting on its laurels and relying on its brand and existing customers. NatWest is also the only bank to offer such a challenge, so if you have a mortgage with any of the other four banks listed, you’ll benefit from lower monthly repayments.

However, while your bank balance may see the immediate benefits, it’s important to note than when switching mortgage providers, the monthly repayment and the headline rate are only part of the picture. You have to look at the whole mortgage package, including the rate, fees, incentives and flexibility. Read our switching mortgage lenders article first. Don’t just simply limit yourself to one lender; search the whole market. It’s sometimes the smaller regional building societies that give the best deals.

So why not take the Moneyfacts.co.uk challenge to find the best deal from the whole of the market? With over 10,000 mortgages available you are bound to find a mortgage which will meet your individual needs.