HSBC’s competitively priced mortgages set to increase over the coming days

by Aaron Strutt

Jun 26 2023

There have been a huge number of fixed-rate mortgage changes over the last few weeks and the market-leading rates have increased. 

HSBC for Intermediaries offers a selection of mortgages priced around 5%, but its most competitive rate is 4.89%. The mortgage is available to borrowers purchasing a property and is fixed until 31 August 2028. Applicants will need a 40% deposit to qualify, and the mortgage maximum loan size is £5 million. The rate is 0.01% for customers remortgaging to HSBC. 

After the fixed period, the mortgage reverts to the lender's current 6.99% standard variable rate, and there is a £999 arrangement fee. The overall cost for comparison is 6.4% APRC representative.

Aaron Strutt, product director at Trinity Financial, says: "The Bank of England increased the base rate last week, and so far, there have not been a massive amount of rate rises. We think the lenders have factored in the base rate rises when they made the many changes we have seen over the last few weeks.

"Santander announced today that it is withdrawing its 40% deposit mortgages which means HSBC is more likely to change its two and five-year fixes over the coming days. They will be receiving a high number of mortgage applications. Our brokers know HSBC are busy because they have to join a virtual queue to submit mortgages."

Are HSBC's two-year fixes cheaper than its five-year fixes?

HSBC's two-year fixed rates and two-year trackers are more expensive than the bank's five-year fixes. HSBC's longer-term rates undercut its short-term mortgages like many other mortgage lenders.  

Representative example: A capital and interest mortgage of £500,000 payable over 30 years, initially on a fixed rate basis until 31 August 2028 at 4.89% and then on the bank's standard variable rate, currently 6.99% for the remaining 25 years, 4.89% would require 61 monthly repayments of £2,650.60 followed by 299 payments of £3,235.86. The total amount repayable would be £1,129,208.74, made up of the loan amount plus interest (£629,270.43 and £999 (product fee), £0 (final repayment charge), £17 (completion fee). The overall cost for comparison is 6.4% APRC representative.    

Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation

The information contained within was correct at the time of publication but is subject to change.

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