Huh, I hadn't heard of CBT until 2007, but your nail biting example is exactly the procedure I made for myself to stop biting my nails in 2003, described in almost the exact words :) Actually, at the very end, my mind would notice the nail-biting reflex before my hand even began to move towards my mouth. It felt awesome, and worked.

Cognitive-Behavioral Therapy has a highly successful approach for breaking habits, which requires only a very subtle alteration to this process. You notice that you are biting your nails. You immediately focus your attention on what you are doing, and you stop doing it. No rage, no blaming yourself, no negative emotions. You just stop, and you focus all the attention you can on the act of stopping. You move your arm down, focusing your attention on the act of movement, on the feeling of your arm going down, away from your mouth. That’s it. You can go back to whatever you were doing.

Five minutes later, you notice yourself biting your nails again. You calmly repeat the procedure again.

By doing this, you are training yourself to perform a new behavior – the “stop and put the hand down” behavior – which is itself triggered by the nail-biting behavior. As you go along, you will get better and better at noticing that you have started to bite your nails. You will also get better and better at stopping and putting your hand down. After a while, this will become semi-automatic; you’ll notice that your hand went to your mouth, a nail touched your tooth, and the hand went back down before you could do anything. Don’t stop training: focus your attention on the “stop and drop” part of the action.

After a while, the nail-biting simply goes away.