HSBC offers fee-free trackers with fix option
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HSBC is scrapping the booking fee, standard valuation fee and completion fee for those looking to switch to a tracker mortgage from another lender until June 5.
At any time during the tracker rate term, borrowers can also apply to switch from a tracker rate to any fixed rate available, without paying any early repayment charges.
It says for customers who apply for a tracker with no fees during the HSBC ‘Your Home’ campaign period, it will ensure that until December 31 2012 there is always a fee-free fixed rate available for them to apply for, provided that their mortgage is no more than 80% of the property value.
This offer will be available to all customers, remortgagers, first-time buyers and homemovers.
Stuart Beattie, head of mortgages at HSBC, says: ‘Homeowners are telling us that they are looking for a low cost way to move to a better value mortgage to help with their monthly budgets.
“Our zero fee trackers allow them to reduce monthly outgoings with minimal hassle and cost. Borrowers with a lender which charges no exit fee can switch to a lower rate at no cost at all.”
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Readers' comments (3)
Derek Frost | 11 Apr 2011 12:43 pm
How cynical but totally predictable. Rates set to rise this year, and not a morsel of advice from over the counter for the poor unsuspecting 'customer'!
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Ray Boulger | 11 Apr 2011 2:28 pm
The rates on these HSBC lifetime tracker mortgages are certainly competitive, although its criteria will be a problem for many borrowers, especially those who want an interest only mortgage.
However, it is important to note the wording of the option to switch to a fixed rate. HSBC’s press release says: “At any time during the tracker rate term, borrowers will have the freedom to apply to “switch” from a tracker rate to any fixed rate available, without paying any early repayment charges.”
As its lifetime tracker mortgages are ERC free, although rather surprisingly this is not pointed out in the press release, it is obvious that no ERC would be payable if borrowers effect a product transfer with HSBC or remortgage.
The important piece of spin in the press release, which I can only assume is designed to imply something it doesn’t say, is “borrowers will have to freedom to apply,” which in itself is meaningless.
If on the other hand HSBC was prepared to commit to allow borrowers with one of these tracker mortgages to switch to any of its new business fixed rates, at the relevant LTV, it offers at the time, subject only to the borrower not being in contravention of their mortgage terms, it could genuinely promote this as a droplock mortgage.
In promoting the fees free aspect of these mortgages the press release also lists lenders which it claims charge no mortgage exit fee, basing it for some reason on info it admits is 4 months out of date!
Amongst the lenders it claims charge no mortgage exit fee are Halifax, Santander, Bank of Ireland and the Post Office. Following FSA intervention a few years ago most lenders who charge an exit fee now give it a different name and so maybe that is why HSBC doesn’t understand that these 4 lenders all have exit fees. Halifax charges £245, but calls it a mortgage account fee, Santander charges £225 and Bank of Ireland and the Post Office both charge £195, with these three lenders calling the fee a deferred arrangement fee, a term which seems to me to be an oxymoron!
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colin chapman | 12 Apr 2011 10:42 am
in my experience HSBC seem to reject more than they sanction. I ve had numerous clients go to HSBC direct and then come back to me after being declined or losing the will to live after 8 weeks of getting nowhere. i guess you can be ultra choosy when you have such market leading rates, but it must be very labour intensive. i m sure they could make it more profitable by utilisng brokers, but then the lose the ability to wind into clients to get the insurances.
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