HSBC commits to lend £350m to high LTV borrowers this year
HSBC - which has provided a mortgage to one in eight first time buyers (FTBs) during 2011 - commits to making a further £350m available to borrowers with equity or a deposit of 15% or less. A minimum of £250m will be reserved for FTBs in this bracket by the end of the year. Maximum loan to value is 90%.
Even though the number of FTBs in the UK has been under 200,000 in each of the past three years, less than half the 500,000 a year seen previously, home ownership is still an aspiration for many people. A recent HSBC survey found that 78% of all non-home owners who have never bought before aspire to be homeowners.
During 2011 HSBC has helped FTBs by offering more competitive rates for customers with a relatively small deposit. As a result, HSBC has already lent more than double the amount to applicants with a 15%-20% deposit in 2011 compared to the whole of 2010.
The support for FTBs continues today with the launch of new high LTV rates. In addition, all 85% and 90% LTV rates will be available fee free.
New mortgage rates for customers with a 10% deposit include:
4.09% above base rate lifetime tracker (current pay rate 4.59%) (fee free)
4.49% two year fixed (fee free)
4.89% five year fixed (fee free)
New rates for customers with a 15% deposit include:
3.49% above base rate lifetime tracker (current pay rate 3.99%) (fee free)
4.29% two year fixed (fee free)
4.69% five year fixed (fee free)
HSBC recognises that the aspiration to be a homeowner continues to be exceptionally strong and one of HSBC's key priorities is to help prospective FTBs.
Peter Dockar, Head of Mortgages at HSBC, said: ‘In 2011 we have continued to offer very competitive rates and great advice to those with a relatively small deposit which has helped us to increase the amount we have lent to first time buyers. Today's announcement of fee free rates and a pledge to make a further £250m available to FTBs in 2011 shows HSBCs commitment to continuing to help people get on the housing ladder.'