Brokers urge lenders to follow HSBC’s lead on products

Brokers are calling on lenders to follow in HSBC\'s footsteps and bring more competitive products to the mortgage market.

HSBC recently launched a range of products with maximum LTVs of 90% and fixed rates of 4.99%, with the backing of £1bn in funding.

The funds are part of the £15bn HSBC has allocated for new mortgage lending in 2009 – twice the amount it lent in 2007.

The mortgages will only be available to clients with HSBC Plus and HSBC Premier accounts.

Ketan Yadav, residential and commercial mortgage consultant at Avenue & Co Private Finance, says he would like to see other lenders step up to the mark and offer similar products.

Yadav says: “HSBC will take a huge market share among new borrowers with these deals, but it will be interesting to see how Lloyds Banking Group responds to this in a competitive sense. I don’t doubt that it will soon be offering some good deals.”

He adds that although the HSBC deals look good he does not think the lender will be able to control the market as others are also offering competitive fixed rates.

Jonathan Burridge, managing director of Quantum Mortgage Brokers, says HSBC should be applauded for coming out with the products.

He says: “It’s frustrating as a broker to not be able to offer HSBC deals and get paid for it but I hope its tie-up with John Charcol encourages it to offer deals to more brokers. I also hope HSBC’s move pushes other lenders to offer aggressive pricing.”

A spokeswoman for Lloyds Banking Group says: “We are the biggest provider of first-time buyer finance and we’re unwavering in our commitment to playing our part in that market.

“As part of our Asset Protection Scheme agreement we will lend an additional £3bn this year and next, on top of the amount we have already forecast. A proportion of this will be to first-time buyers.”