by Mark Johnston
HSBC Launch Lowest Ever 2 Year Fixed Rate.
After years of being downtrodden the mortgage customer may at last be back in the driving seat.
Recent research conducted by Moneyfact.co.uk, a financial advice website, reveals that the mortgage market on a whole has literally turned on its hea in the last 5 years.
Sylvia Waycot, editor at Moneyfacts.co.uk , said “during the last 5 years the UK mortgage market has changed beyond recognition”.
The mortgage market has begun to see some forward thinking lenders entering the market with innovative products, one such lender appears to be the HSBC, a direct only lender.
Gross mortgage lending for HSBC grew 24 per cent over the course of 2012, from £13.2 billion to reach £16.4 billion, meaning that the banks market share of mortgage approvals rose 2 per cent.
At the end of the year Antonio Simoes, UK head of the HSBC, stated “we are committed to helping the UK economy recover by continuing to support our customers through the coming years”.
Therefore, HSBC marked the start of 2013 with new competitive mortgage rates for those customers with just a 10 per cent deposit.
All of the banks 90 per cent loan to value (LTV) rates are also fee free for HSBC current account customers or have a £599 booking fee and a valuation fee payable for non- current account customers.
Rachel Sprinall, finance expert at Moneyfacts.co.uk, stated “HSBC’s new deals aimed at first time buyers provide borrowers with competitive rates coupled with a reasonable fee at a high loan to value percentage”.
The lender has also maintained its 1.99 per cent 2 year fixed rate product for those borrowers with a 40 per cent deposit or equity.
However, just recently the bank has responded to the growing demand of borrowers seeking a fixed rate mortgage and it has now launched its lowest ever 2 year fixed rate deal with an outstanding rate of just 1.79 per cent.
The deal is available to both first time buyers and next time buyers as long as they have either a 40 per cent deposit or the same in equity. This particular mortgage also comes with a fee of £1,999.
It has also launched a 2 year discount rate at 60 per cent loan to value (LTV) at 1.75 per cent, this too comes with a hefty £1,999 fee.
Peter Dockar, head of mortgages at HSBC, says “we will continue to support our customers by offering them competitive rates to help fund their property aspirations”.
Some mortgage experts believe that this particular deal is an excellent one, but while it is true that for some borrowers it may be worth paying a higher fee in order to benefit from the lowest rate, it does also depend heavily on the actual size of the loan required.
Mortgage spokesperson at MoneySupermarket.com, a comparison website, suggests “it is good to see HSBC reducing the rates on fixed mortgages but borrowers need to make sure they look beyond the headline rate and work out the true cost of the mortgage, once the fees are taken in to account”.
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