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HSBC to launch 1.99% mortgage

HSBC is to relaunch its two-year discounted mortgage at 1.99% at up to 60% LTV after taking it off the market last year.

The product will be available from March 15 and comes with a £999 booking fee and a maximum loan size of £250,000.

The lender originally launched the 1.99% deal, representing a 1.95% discount from HSBC’s SVR, last September.

The deal was available for two months before it was taken off the market, and will now be relaunched on March 15.

HSBC’s current range includes another two-year discounted deal at 2.94% at up to 70% LTV with a £499 fee.

There is a five-year fixed rate deal at 4.64% up to 60% LTV and with a £999 fee, and a lifetime tracker at 3.49% up to 75% LTV with a £599 fee.

 

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  • Grey Haired Underwriter 16th March 2010 at 9:19 am

    Anon 1.04. I agree that most underwriters lend against a specific criteria but any underwriter worth his/her pay should know what is prudential and what is not. If a firm starts to loosen policy who is going to stop them excepting those involved in credt/Risk. Also bear in mind that most firms give underwriters an element of discretion to lend outside of policy and that is where the losses are made. It is true to say that bad underwriting decisions are behind the loss of a lot of companies – especially where fraud is involved and it has failed to be spotted becuase of poor due diligence. I would however accept that the continual weakening of credit scores for the large lenders has also had a major contribution towards the general malaise in the market.

    And to Valleyboy I would make the same comment that I have made before. Sub-prime borrowers are not sub-prime for life unless they have failed to learn the lesson of their previous credit mistakes. By the time they come to the end of a deal they should be re-mortgageable to a prime lender. If they haven’t managed to become seasoned borrowers then it might have something to do with their attitude to credit.

  • valleyboy 12th March 2010 at 4:16 pm

    i would disagree, the market needs specialist lenders in the near prime bracket, to facilitate those people through no fault of their own lost a job or had a bereavement eg eg. What about all the sub prime people on low svr’s at the moment, whats going to happen to them when rates start rocketing ?

  • Paul Goldsmith 12th March 2010 at 1:04 pm

    Grey Haired – How can somebody involved in underwriting bring down their employer? Any loans approved by underwriters were only ever done so against criteria laid out by the lenders at any particular time. The fact that the criteria may not have been as stringent as it could have been is down to the people who make business decisions. So if anybody brought down companies it was the highly paid executives. Despite the obvious problems I maintain there is a place for these products, as long as mistakes are looked upon as a learning curve and acted upon accordingly.

  • Grey Haired Underwriter 12th March 2010 at 11:22 am

    yes anon 10am I’ve made my mistakes but never to the extent of bringing down my employer! This is also my third recession so I am quite chuffed that have had below average arrears issues in all them (touch wood). And I can assure you that I have made more than my fair share of what might be called ‘specialist’ loans. The advantage I have had is that I make my own decisions and don’t rely on software whereas the likes of GMAC etc lauded the use of computer based decision making.

    The grey hairs come with experience of dealing with people and not being a machine minder.

  • Paul Goldsmith 12th March 2010 at 10:00 am

    Grey Haired you are totally correct. Specialist lenders did take unacceptable risks in the past but have you never made a mistake in your life? What percentage of pre recession ‘prime’ clients do you think have got throught the recession with their ‘prime’ credit status intact? Sensible underwriting can rescue the market. The days of a unskilled worker self certing £50,000 per annum with no checks should never return, but the marketplace needs some kind of specialist lending.

  • Grey Haired Underwriter 11th March 2010 at 4:04 pm

    When will you guys realise that lenders will only go back into the high LTV market if they can find suitable third party collateral (I would give my eye-teeth to be able to find an acceptable indemnifier and corner the market). And as for the comment about the need for specialist lenders, does it not occur to the correspondent that there are no longer any specialist lenders because they took on unacceptable risks and no longer exist as lenders. I wonder if you would lend your own money to some of these people that you want lenders to pander to?

  • valleyboy 11th March 2010 at 2:57 pm

    Not worried at all, they are only approving 1 in 5 of all applications anyway, i really dont know what they are playing at, it may bring other lenders to this rate but who knows

  • Luke Atkinson 11th March 2010 at 12:13 pm

    Not particularly worried about this as a broker. A discounted rate from the SVR, with tie ins I imagine? If it was a BBR Life Time Tracker with no tie ins then potentially damaging but as HSBC won’t allow fees to be added to the loan and these need to be paid on application, it will deter most customers who are borderline. What does worry me is how HSBC seem to be exempt from TCF and Data Protection by with holding bank statements to customers taking advantage of other institutions mortgages until the customer sits with their advisers, come on FSA, lets see your teeth!

  • Paul Goldsmith 11th March 2010 at 10:51 am

    95% deals will help the market for sure but until there is some specialist lenders out there the market will continue to stagnate. People have had to prioritise payments during the downturn with the mortgage payments taking priority over unsecured debts. This may have lead to some adverse credit for people who have done the perceived correct thing and paid the mortgage above all else. Once they are back to stability are they really unmortgageable? Common sense lending decisions required to kick start the market.

  • Bobby 11th March 2010 at 10:37 am

    I agree. The only problem being that some new clients are “tyre kickers” and will treating a mortgage like shopping around for car insurance and will always go for a headline rate. Suppose the up front fee is a bonus for brokers.

  • matt riddington 11th March 2010 at 10:36 am

    With low income multiples and the highest level of applicant scutiny, this product will only benefit a small number. Of no concern.

    Tony’scomments above regarding 90/95% deals hits the nail on the head. Until we see high loan to value deals the property market will continue to stagnate.

  • Stephen Rodley 11th March 2010 at 10:33 am

    HSBC are now so big that the FSA will do little or nothing to bring them into line!

    Can you imagine the FSA if we were to withold any information from OUR clients?

    They are rapidly becoming an oversized thug in this market place….

  • IFA 11th March 2010 at 10:16 am

    Damm !!

  • Luke Atkinson 11th March 2010 at 10:15 am

    Not particularly worried about this as a broker. A discounted rate from the SVR, with tie ins I imagine? If it was a BBR Life Time Tracker with no tie ins then potentially damaging but as HSBC won’t allow fees to be added to the loan and these need to be paid on application, it will deter most customers who are borderline. What does worry me is how HSBC seem to be exempt from TCF and Data Protection by with holding bank statements to customers taking advantage of other institutions mortgages until the customer sits with their advisers, come on FSA, lets see your teeth!

  • Tony Barlow 11th March 2010 at 10:07 am

    When are lenders going to wake up to the fact that we need the deals at the 90%/95% ltv end of the market.