21st November 2013
HSBC will make two fixed rate mortgages, up to 95 per cent loan to value, available to customers as part of HM Treasury’s Help to Buy scheme from next Monday.
All HSBC mortgage borrowers are assessed to ensure they could afford repayments at an interest rate significantly higher than the Bank of England base rate. For customers opting for a 90% to 95% LTV mortgage HSBC will ask them to acknowledge a monthly repayment illustration at a responsible long term rate. This will provide an indication of their increased monthly mortgage payment when, as expected, interest rates rise.
The two mortgages are a 4.79% 2-year fix – up to 95% LTV with a £99 booking fee and a 4.99% 5-year fix – up to 95% LTV with a £99 booking fee
Brendan Cook, head of retail banking and wealth management for HSBC UK says: “We want to support our customers, whether they are buying their first home or moving up the housing ladder. In order to protect them, we want to ensure they can afford their repayments when interest rates rise”.
In line with HSBC’s responsible lending approach and to safeguard customers at this 90-95% LTV level in the event of future house price fluctuations, the bank will require them to have a minimum deposit of £10,000. All 90-95% LTV mortgages will only be sold in the bank’s branch network, and, in line with all HSBC mortgages, will not be offered through mortgage brokers. Initially the mortgages will only be available to customers looking to purchase a property, however we will look at offering these loans to remortgage customers at a later date.