- Major lender is both increasing and decreasing rates, as of tomorrow
HSBC has said it will be increasing some of its cheapest mortgage rates – though more expensive deals will be cut.
From tomorrow, the bank will hike rates across its lowest-priced products – those reserved for buyers with the biggest deposits or homeowners remortgaging with large amounts of equity.
Although HSBC won’t reveal the changes until tomorrow, it is likely that its 3.82 per cent five-year fix will rise – this is for those buying with at least a 40 per cent deposit.
HSBC is the latest lender to increase mortgage rates, but is also lowering some of its deals
Its 3.83 per cent rate for those remortgaging with at least 40 per cent equity is also likely to be increased.
> How to remortgage your home: Your guide to finding the best deal
However, HSBC is also lowering rates across some of its products aimed towards those buying with smaller deposits or remortgaging with less equity.
This should benefit homebuyers with a deposit of 20 per cent or less or homeowners with 20 per cent equity or less.
Last week Halifax and Barclays upped home loan prices following similar moves by NatWest, Santander and TSB earlier in the week.
Mortgage brokers and market commentators believe HSBC’s willingness to lower rates for those with smaller deposits signals the bank is confident that house prices will continue to rise.
Ben Perks, managing director at Orchard Financial Advisers in Stourbridge, told the news agency Newspage: ‘As most lenders make rate increases across the board, HSBC are decreasing rates for anyone borrowing more than 80 per cent of their property value.
‘First-time buyers are some of the most active at the moment, so they want to secure these customers. It’ll benefit plenty of borrowers.’
Rohit Kohil, director at The Mortgage Stop added: ‘This suggests confidence in the property market and aims to make borrowing more accessible to first-time buyers and those with less equity.
‘On the other hand, those with lower LTV ratios will see their borrowing costs increase, though this may simply be HSBC adjusting its business levels rather than indicating a broader market trend. Balancing risk and demand is likely behind these varied adjustments.’