HSBC unveils 0.99pc mortgage
The bank has also unveiled a 2-year fix at 1.49%, with both products coming with a £1,999 booking fee.
Peter Dockar, head of mortgages at HSBC, said: “We know how important a low monthly payment is for borrowers, and are committed to offering market leading rates.
“We’re the only bank to offer a completely paperless mortgage application and are now leading the way by offering a mortgage of less than 1%.
“Customers can apply for these rates online, over the phone, in branch or through a broker thanks to our new partnership with Countrywide.”
But Andrew Hagger, director of Moneycomms.co.uk, said there is too much emphasis on the rate.
He said: “When you realise that a £1,999 fee adds the equivalent of an extra £83.29 per month to your mortgage repayments.
“Some customers will be drawn in by the headline grabbing rate without realising there’s a £2,000 sting in the tail.
“For example, there is a 2-year tracker deal (at a slightly better LTV of 65% compared with HSBC 60%) currently available from Norwich and Peterborough Building Society at 1.49% but much lower £345 fee.
“This mortgage works out cheaper than HSBC until you reach a crossover point at the £300k mark then HSC becomes cheaper.”
For borrowers looking to use HSBC without paying a fee, the bank also offers fee saver remortgage specials until November 30 for customers switching to the bank.
This range includes a 60% LTV 2-year fix at 2.19% and a 60% LTV 5-year fix at 3.19% with standard valuations included.