HSBC launches new discount mortgage deals

HSBC is continuing to offer market-leading mortgages by launching a range of discount deals, including a 4.99% two-year discount loan that is the only two-year sub-5% discount mortgage on the market.

Available only direct from HSBC from Monday, 30 June 2008, the mortgage has a £2,499 fee, maximum LTV of 80% and borrowing limit of £250,000.

For customers seeking to borrow up to £500,000, HSBC can offer a choice of two-year discount mortgages at 5.49% with a £999 fee, and 5.69% with a £249 fee. HSBC will also continue to offer its special Remortgage Tracker at 5.79% with a £599 booking fee.

HSBC is continuing to offer homeowners the option of a two-year fixed rate, though from 30 June the rate will increase by 0.45% to 6.74% (with a £799 booking fee). HSBC's three-year, five-year and 10-year fixed rate mortgages will increase by 0.3% to 6.59%.

Andy Mielczarek, HSBC's head of lending, said: "Our new Discount deals offer substantial discounts on our standard variable rate of 6.25%, which itself is the best on the high street. Variable rate mortgages are starting to look attractive against fixed rate deals, which are now carrying higher fees.

"These are uncertain times and a lot of people coming off fixed rate deals will be looking to lock their repayments in for a few more years. But homebuyers really need to think about whether the peace of mind of a fixed rate is currently worth an effective 1% increase in overall costs that a high booking fee can represent."

"There have been some claims about banks trying to move customers onto variable rate loans and then manipulating mortgage rates to increase their margins. For our part, HSBC has an excellent record of passing on falls in the base rate to its home buyer variable rate customers. This is supported by the independent Network Data finding that HSBC's home buyer variable rate mortgage customers paid less interest on a £100,000 interest-only mortgage over the last five years than any other national mortgage bank."

Moneyfacts, the financial data provider, recently recognised HSBC's success in helping homeowners switch lenders with it's Best Remortgage Lender 2008 Award.