Rate changes affect residential, remortgage, and international mortgages
HSBC has announced new rates for a variety of mortgage products available to both new and existing customers, as intense competition continues among lenders who are cutting rates and introducing new offerings to attract borrowers.
The changes, effective tomorrow, August 5, will apply to residential, remortgage, and international mortgages, with the majority of adjustments involving rate reductions for lower loan-to-value (LTV) products.
The high street bank confirmed that most two- and five-year fixed rate mortgages for first-time buyers and home movers at 60%, 70%, and 75% LTV will see lower rates. This update covers Fee Saver, Standard, High Value, and Premier Exclusive products.
HSBC will also increase rates on certain five-year fixed mortgages at higher LTVs of 80% and 85%. The affected products include the five-year Fixed Fee Saver, Fixed Standard, and Fixed Premier Exclusive options at these LTV ratios.
Energy-efficient homes with an energy performance certificate (EPC) rating of ‘A’ or ‘B’ will also see similar rate changes, with reductions at lower LTVs and increases at higher LTVs for select five-year fixed products.
In the remortgage segment, HSBC is set to cut rates on several 2-year fixed products at 70% and 75% LTV.
A full list of all mortgage products impacted by these changes is available in HSBC’s rate summary document.
The move comes as competition intensifies among UK lenders, with several major banks — including Halifax and others — recently announcing rate cuts and new product launches in an effort to attract borrowers. The ongoing rate war is driving down costs for homebuyers and those looking to remortgage, with trend of lower pricing expected to continue, particularly as the market expects a cut in the Bank of England’s upcoming rate decision.
Last week, HSBC UK reported mortgage growth of £2.6 billion in the year’s first half, driven in part by increased lending balances. HSBC UK’s financial results showed a 7% year-on-year decline in profit before tax to £2.5 billion ($3.2 billion). Revenue for the UK business rose by 4% to £4.6 billion.
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