HSBC offers new 90% mortgages

Bank promises its new deals will ‘beat or match’ main rivals on the high street

The mortgage price war has resulted in lots of good deals for borrowers with plenty of equity or a large deposit. Now things could be looking up for first-time buyers.

On Monday, HSBC is launching a range of “market-leading” 90% mortgages aimed at newcomers to the property market, including a two-year fixed-rate deal at 3.59% and a five-year fix at 4.39%. Perhaps more notably, it is promising that its first-time buyer rates will be “the lowest on the high street”.

HSBC says that under its First for First-Time Buyers initiative, rates will “beat or match” the 90% loan-to-value deals offered by eight other major high street brands: Barclays, Woolwich, Halifax, Lloyds TSB, Nationwide, NatWest, Royal Bank of Scotland and Santander.

The promise applies to two- and five-year fixed rates and lifetime trackers for buyers with a 10% deposit, provided the rival deals don’t charge a booking fee of more than £999.

The deals, only available direct from HSBC, also include a 3.99% lifetime base rate tracker.

Each of these mortgages carries a £999 fee if you are a HSBC current account customer, or £1,499 if you aren’t. Non-customers can open an HSBC account and pay £999.

There is, of course, some small print attached to the HSBC promise, which will run until 3 November. It excludes any subsidiaries or other trading names of the eight providers, and the maximum loan is £400,000.

At the time of writing, the HSBC rates certainly looked good for those who can manage a 10% deposit. The Skipton and Hanley Economic building societies offer 90% two-year fixes priced at 3.99% and 4.09% respectively, though the Skipton loan boasts no application or completion fees, plus you get £160 cashback following completion, while the Hanley Economic deal carries a £200 booking fee.

When it comes to five-year fixes, Nottingham building society has a loan at 4.39%, matching the HSBC rate, though the fee is cheaper: £299, which includes a £100 booking fee.

 

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