PLC 4ever
Related Articles
Record low interest rates hit the mortgage market: TSB and HSBC both start two-year fixed contracts at only 0.94% (but beware of the high fees)
Lenders attract borrowers with the lowest mortgage rates ever.
TSB and HSBC have now both signed two-year fixed contracts with an interest rate of only 0.94 percent.
However, mortgage brokers have urged caution about the flashy interest rates, both of which charge a fee of £ 999.
Record contracts: TSB and HSBC both signed two-year fixed contracts at a rate of just 0.94 percent. But brokers have urged caution on the deals, which both come with a £ 999 fee
HSBC announced yesterday that it will lend buyers up to £ 5 million at a rate of 0.94 percent, which will drop to 3.54 percent after the two-year term. Borrowers must own at least 40 percent of the home.
TSB launched a similar deal last week, offering rescheduling homeowners the option to borrow up to £ 1 million and get £ 300 cashback as well. The lowest available price last month was 0.99 percent from TSB.
Rob Gill, Managing Director at Altura Mortgage Finance, said: ‘The lenders battle for low-lending value mortgages continues with this latest volley from HSBC.
Good news for borrowers with high deposits or equity, especially well-prepared borrowers who have the time to shop around.
“For those in the right circumstances, these record low interest rates can offer tremendous savings to borrowers reaching the end of an existing interest rate.”
Several lenders have offered 0.99 percent interest rates in the past few months to take advantage of the housing boom – but some only for a limited time.
Graham Taylor, managing director of Hudson Rose mortgage broker, said, “Borrowing at 0.94 percent is incredible and shows how competitive the market is.
HSBC’s criteria are pretty reasonable. Provided applicants have the required equity in the property and are looking for a short term solution, this is a great opportunity. ‘
Rachel Springall of financial data firm Moneyfacts says it’s important for borrowers to weigh the true total cost of the deal before committing.
“There are now several lenders who offer fixed-rate mortgages at around 1 percent or less. Given the ongoing competition, it will be interesting to see how low lenders are willing to take the limelight. ‘
Broker Ashley Thomas, Director of Magni Finance added, “For those who borrow less than £ 500,000, this product is more expensive than HSBC’s 1.14 percent free product, taking into account the £ 999 finder fee.”
Meanwhile, Katie Cave, director of mortgage advice at Clearpoint Finance, says those with less than perfect credit are unlikely to benefit.
She says, “Everything in this price range is likely to come with a high fee as well. How else does the lender make a profit? Beware of investing in short term savings and losing better value in the long run. ‘
HSBC has also cut rates by as much as 0.3 percent on more than 40 other mortgages – including deals for first-time buyers and those looking to reschedule.
In the meantime, the interest rate for those with a 15 percent deposit will be cut by 0.30 percent to 1.99 percent – the lowest since October 2020.
First-time buyers with 10 percent deposits will have access to a two-year fix at an interest rate of 2.49 percent – the lowest since low-deposit lending was reintroduced in January.
