Seeing as most people seemed to appreciate the First Direct deal, why not save an extra 0.1%? The 5 year fixed seems like a great option as it balances a cheap interest rate with a long term fixed %.
Fee-saver, just like the First Direct so no upfront fees are payable!
HSBC should be easier to get approval compared to First Direct also.
Latest comments (60)
sbirsen
13 Aug 17#60
Does a joint application require a joint Hsbc advanced account?
paulrwarner
8 Aug 17#27
Need to earn min of £100,000 if you want interest only!
othen to paulrwarner
8 Aug 17#28
I can't see that under any of the conditions for this mortgage, why do you think it is the case? I always preferred interest only mortgages because I found them much more flexible, I earned about £80,000/year (before retiring - half that now) and never had any problems, so I think you may be wrong in this instance.
whatyadoinsucka to othen
8 Aug 17#29
Yes interest only mortgage you must earn £100k for HSBC products, those are the rules. i took out a new add on mortgage in march and got told this.
imho it's because in the past people taking interest only mortgages had massive gains in equity, with the house markets rising rapidly. Now the banks want to ensure you repay capital and thus reduce the actual loan, rather than paying interest only
othen to whatyadoinsucka
8 Aug 17#31
How interesting, I think that rule must be particular to HSBC. I still have a mortgage (with Virgin money) on one of my houses and that is the interest only type.
whatyadoinsucka to othen
8 Aug 17#33
yeah it is hsbc's rule, to be honest hsc have always been strict, if you havent perfect credit and cannot prove you have disposable income they will reject
othen to whatyadoinsucka
8 Aug 17#41
Thank you for that. I was just curious, at my stage of life (I'm 56) I've settled the mortgages on 2 of my 3 properties (the other is a BTL where it makes sense to have an interest only mortgage), so this is a bit academic for me. I'm interested in how people borrow money these days though, my son is just a teenager so he will be involved in this in half a dozen years' time.
I'm old enough to remember interest rates at 15% in the 1980s, and that could happen again (and would be a calamity for many) - so I'd certainly recommend fixing for as long as one feels comfortable with whilst it is possible (accepting there will be a loss of flexibility should one need to sell the property before the end of the contract period).
ivotedyes to whatyadoinsucka
8 Aug 17#51
Ahh! I was going to ask if they wud be likely to lend to us as I am on ESA long term sick and my husband is part-time we are in our 50s. I would be switchinh from our current mortgage to move to them. Do you know if they consider things like this or is it based purely on the disposable income from the figures we give them??
whatyadoinsucka to ivotedyes
8 Aug 17#40
disposable income was badly worded, it should read Affordability, my joint application (feb17) they wanted 3 month payslips and all bank statements, then queried amounts coming in and out..as well as monthly spend bills, hobbies, cars, mobiles/tv packages, meals out etc etc. in effect they were calculating our wages and lifestyle could afford the mortgage with excess disposable
ivotedyes to whatyadoinsucka
9 Aug 17#55
Thx. Helpful
paulrwarner to paulrwarner
8 Aug 17#49
Oh and BTW the TSB want a pension fund of £1m if you want interest only, Natwest want £75,000 min income, only lenders at mo with realistic mortgage criteria and rates are Bank of Ireland and Leeds building society. Leads doing 2 yr fix for 1.5%
othen to paulrwarner
8 Aug 17#36
I think perhaps you are mistaken. I know from personal (and fairly recent) experience that Britannia BS (now Co-Op) and Virgin Money have no problems with interest-only mortgages. I have had quite a few mortgages over the years, all except one was interest-only, and I never experienced any difficult obtaining the loans. I suspect that sometimes spurious excuses (like not earning at least £75,000 salary) are used by institutions to discourage those borrowers they would rather not deal with for other reasons. :-)
paulrwarner to othen
8 Aug 17#53
The criteria is on their websites before they know anything about your circumstances. And the key word in my paragraph was 'realistic' criteria, maybe should have said competitive rates too!
othen to paulrwarner
9 Aug 17#57
This is not going anywhere, but In just did a google search for 'interest only mortgage' and found lots available - even a list of the top 10 (from money.co.uk with good deals from HSBC, Barclays, Virgin and others), I've clicked on a few (randomly) and can't find any specific limitations regarding income or pension pots on any...
I'm not doubting you in that it is probably more difficult to convince a lender that you will have a means of paying the loan back in 25 years than it would have been 30 years ago (when inflation and equity growth were much higher and we had not had a global recession in living memory), but I do think you are mistaken about there being hard and fast rules on incomes and pensions for this types of loan.
I took out an interest-only loan (for a BTL) only 3 years ago and had no problem, I did have to show that I could pay it back from my investment account (which I could - easily) but there was no issue. I think lenders are (rightly) being cautious (and governments have told them they have to be) because too many people defaulted a decade ago - I think this is a good idea because I don't want my savings being used to fund someone who may then decide to default!
Best wishes.
paulrwarner to othen
9 Aug 17#59
I'm in the process now. Nightmare! and our circumstances are better and we can prove we can pay off the 40% LTV Interest only mortgage we've had for 10 years. Good luck when you need to renew - goal posts have moved. :disappointed:
Interest Only policy changeWith effect from the 11 February 2016 we are simplifying our Interest Only Mortgage eligibility criteria and will no longer restrict it to Premier customers only.
In order to be eligible for an Interest Only mortgage, a sole applicant must have a gross income in excess of £100,000 per annum.
For joint applications, at least one customer must have a gross income in excess of £100,000 per annum.
Overtime, bonuses, commission and rental income do not qualify as eligible sources of income.
All customers are eligible to apply for an Interest Only Mortgage provided they meet the above eligibility criteria.
david_wavid
8 Aug 17#35
Maximum 60% LTV, does that mean I need a 40% deposit?
othen to david_wavid
8 Aug 17#37
In effect yes. The mortgage can't be more than 60% of the cost of the house one is buying or re-mortgaging.
david_wavid to othen
8 Aug 17#39
So I cant get this deal with a 10% deposit?
othen to david_wavid
8 Aug 17#43
Of course not!
ivotedyes to othen
8 Aug 17#32
Harsh!!
othen to ivotedyes
8 Aug 17#38
Sorry, I will re-phrase that: Perhaps it might be a tiny bit difficult to obtain a loan at a very preferential rate when the lender asks for a 40% deposit as security and the borrower has only 10%, but of course it would certainly be worth trying: perhaps turning up at his office wearing a smart suit and nice shoes and carrying a small gift ...
ivotedyes to othen
9 Aug 17#56
Now that's just so much more pleasant isn't it!!?? :raised_hand:
r2mahara
7 Aug 17#6
You could consider the first direct fixes - they allow unlimited overpayments
Billythebubble to r2mahara
8 Aug 17#52
So do HSBC up to 10% each month I believe
morgie to Billythebubble
8 Aug 17#54
It's 10% of the balance at the start of the mortgage year if on an HSBC fixed mortgage. This over payment allowance is made clear online.
On the variable rate it's unlimited over payments.
thriftybugger
8 Aug 17#50
I would wait for interest rates like in Denmark. wsj.com/art…111 "Hans Peter Christensen got some unusual news when he opened his most recent mortgage statement. His quarterly interest payment was negative 249 Danish kroner." People have been saying the rates will go up for the last 8 years now.
messiahcomplex8
7 Aug 17#9
Out of interest, total mortgage n00b here, but if this is good, would I bother going via a mortgage broker? Or just go to HSBC
kawa1981 to messiahcomplex8
8 Aug 17#47
I went to HSBC for a mortgage i could easily afford and they wanted all sorts of paperwork (lease paperwork) and declined me in the end with no reason even tho i was one and a half times within the affordibility. Myself and most of the people i know use nationwide - decent rates and no mortgage broker, all done instore
triffid68
8 Aug 17#48
They do pick through your spending with a fine toothed comb. You must tell the truth of course. I don't know if all mortgage providers are the same, but you can't blame them I suppose!
cuffbertt
8 Aug 17#45
1.84%!! Makes my terrible 4.79% look even worse! :astonished:
ivotedyes to cuffbertt
8 Aug 17#34
I'm right behind you at 3.38 or something :cry:
DanielGong
8 Aug 17#42
1.44 fee free from halifax btw
AlfieW123 to DanielGong
8 Aug 17#44
Not sure where you are getting this from, looking on the Halifax website, the fee free one is 1.89% for a 60% LTV 2 year fix
piglethvc to DanielGong
8 Aug 17#46
Looks to me like this one is Purchases Only/First Time Buyers Only, not fee free, £999, so not for re-mortgages/current customers.
Dird
8 Aug 17#30
For those of you remortgaging with 75% LTV or better (but worse than 60%), Atom Bank aka Digital Mortgages is doing 1.89% for 5 years
Fact_or_Fiction
7 Aug 17#2
My view would be to look at a 5 year deal as minimum going forward, The rates can only go up now people...Nothing left to drop. The next 2 years is a Gamble, My money's on Fixed for 5 or 10 years...Other than that its a good deal, so have some heat. :skull_crossbones:
AlfieW123 to Fact_or_Fiction
7 Aug 17#3
I must admit I thought the other way, I thought although they may not drop any further, I cant see them going up anytime soon! And the banks must think this too, as ultimately they are only offering long term fixes at a rate that they will make a profit on? I got a 2 year fixed mortgage from HSBC and I plan to keep renewing it every 2 years for the super low interest rate :laughing:
Fact_or_Fiction to AlfieW123
7 Aug 17#19
Well, like i said it's a gamble, I would not trust the banks on knowing much more than any normal Jo public, after all, the reason for the low rates is due to the banks in my view getting it wrong in the first place. The banks are risking nothing if you look at the deal above. 60%LTV. the bank of England rate are 0.25%, They have a cushion of 1.25% and if the worse case scenario is that they go up fast...well they have your house with another 40% cushion....i would rather sit on a 5 or 10 year deal circa 2.5% max rate, in the knowing its affordable. 2 years for me is not long enough with the many unknowns currently looming with Brexit...Each to your own....hope it all goes well for you! :thumbsup:
morgie to Fact_or_Fiction
7 Aug 17#26
I thought the same in 2014 :angry:
They have a 0.99% 2 yr tracker at 60% LTV. It does have a £999 booking fee. It would take just under 4 x 0.25% interest rate rises within the 2yrs to become 'worse' than the 1.89% 5yr fix. It's worth anyone modelling their repayments against that. Also unlimited over payments allowed compared to 10% of the remaining balance on a fix (but realise this isn't a problem most of us have!).
richierich2013
7 Aug 17#21
Agreed 5 year fix rate at 1.98 with HSBC lucky I seen this will be getting it changed tomorrow to this 1.84 happy days good job I've not bought my house yet
othen to richierich2013
7 Aug 17#23
The difference is only worth £140/year on a £100,000 mortgage!
bluecityste to othen
7 Aug 17#24
Exactly! Happy days!
richierich2013 to othen
7 Aug 17#25
My mortgage is going to be more than £100000 thanks for the worry though
Tonic84
7 Aug 17#7
I've just switched to HSBC and in order to get the fee free deal, had to use their appointed solicitors. They were absolutely terrible, got things wrong, were incredibly slow and their communications often contradictory or issued weeks late.
Saying that, because I started the process early - I did manage to complete before my existing deal ended. However I would rather have paid a couple of hundred extra for a better solicitor.
othen to Tonic84
7 Aug 17#22
Most solicitors are like that, even the ones you pay for yourself. Conveyancing is not very lucrative so it is not worth a solicitor investing much of a clerk's time in it. I'm not sure a few hundred more would have achieved a much better result.
djwilko
7 Aug 17#18
What's the LTV on these?
othen to djwilko
7 Aug 17#20
It is in the rubric!
ran123ran
7 Aug 17#17
Do they not have a 10 year fee free deal?
othen
7 Aug 17#16
Money is very cheap at the moment, but it may not always be that way. If one needs a mortgage it would be a good idea to fix a low rate like this for a long period now, the downside will be that it may be difficult to move house during the fixed rate period or sell when then next downturn in house prices comes.
gemignani
7 Aug 17#14
I have previously fixed with 5y 1.69%, but I can see it is now 1.59% for 5y, I have already paid the booking fee, but solicitors are still working to get the contract... Would they be able to move me to this cheaper deal?
gemignani to gemignani
7 Aug 17#15
Just replying here as more people would be interested to know... called and they said I would have to pay the booking fee again...
Kenmarinaris
7 Aug 17#13
Nice but HSBC. I never liked them. There was always somethingwith them that made my life harder. Even now cannot see 5 years mortgage details on their website.
CauveryShelat
7 Aug 17#12
What are hsbc and first direct like with council flats? Non high rise
njdavis103
7 Aug 17#11
We've had fixed rates for HSBC for years and never had any problems with porting across mid term. Never paid any early repayment and always had competitive rates. I'm going for 1.84% very shortly
tomtomato
7 Aug 17#10
Sorry, the FD deal I posted is better!! :smile:
Unlimited overpayments for FD, only 10% for year for HSBC.
Therefore, that 0.1% advantage could soon be lost with HSBC, if you can repay most of your mortgage before the end of the term.
GMac11
7 Aug 17#8
The 3 and 5 year look very good. I am currently on a 1.39% baseline tracker (1.89% all in) with HSBC and those fixed rates are very enticing. Problem is I sort of plan to move in the next 2 to 3 years so a 2 year would be the most sensible deal, not sure if it's worth the hassle though.
hillcraig87
7 Aug 17#5
r/humblebrag
pontiacy
7 Aug 17#4
My mortgage advisor told me that I needed to pay extra fee (>200) because my solicitor was not on their panel. And there were other hassles too.
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Opening post
Seeing as most people seemed to appreciate the First Direct deal, why not save an extra 0.1%? The 5 year fixed seems like a great option as it balances a cheap interest rate with a long term fixed %.
Fee-saver, just like the First Direct so no upfront fees are payable!
HSBC should be easier to get approval compared to First Direct also.
Latest comments (60)
I always preferred interest only mortgages because I found them much more flexible, I earned about £80,000/year (before retiring - half that now) and never had any problems, so I think you may be wrong in this instance.
i took out a new add on mortgage in march and got told this.
imho it's because in the past people taking interest only mortgages had massive gains in equity, with the house markets rising rapidly. Now the banks want to ensure you repay capital and thus reduce the actual loan, rather than paying interest only
I think that rule must be particular to HSBC. I still have a mortgage (with Virgin money) on one of my houses and that is the interest only type.
I'm old enough to remember interest rates at 15% in the 1980s, and that could happen again (and would be a calamity for many) - so I'd certainly recommend fixing for as long as one feels comfortable with whilst it is possible (accepting there will be a loss of flexibility should one need to sell the property before the end of the contract period).
in effect they were calculating our wages and lifestyle could afford the mortgage with excess disposable
I suspect that sometimes spurious excuses (like not earning at least £75,000 salary) are used by institutions to discourage those borrowers they would rather not deal with for other reasons.
:-)
I'm not doubting you in that it is probably more difficult to convince a lender that you will have a means of paying the loan back in 25 years than it would have been 30 years ago (when inflation and equity growth were much higher and we had not had a global recession in living memory), but I do think you are mistaken about there being hard and fast rules on incomes and pensions for this types of loan.
I took out an interest-only loan (for a BTL) only 3 years ago and had no problem, I did have to show that I could pay it back from my investment account (which I could - easily) but there was no issue. I think lenders are (rightly) being cautious (and governments have told them they have to be) because too many people defaulted a decade ago - I think this is a good idea because I don't want my savings being used to fund someone who may then decide to default!
Best wishes.
Interest Only policy changeWith effect from the 11 February 2016 we are simplifying our Interest Only Mortgage eligibility criteria and will no longer restrict it to Premier customers only.
Perhaps it might be a tiny bit difficult to obtain a loan at a very preferential rate when the lender asks for a 40% deposit as security and the borrower has only 10%, but of course it would certainly be worth trying: perhaps turning up at his office wearing a smart suit and nice shoes and carrying a small gift ...
On the variable rate it's unlimited over payments.
wsj.com/art…111
"Hans Peter Christensen got some unusual news when he opened his most recent mortgage statement. His quarterly interest payment was negative 249 Danish kroner."
People have been saying the rates will go up for the last 8 years now.
They have a 0.99% 2 yr tracker at 60% LTV. It does have a £999 booking fee. It would take just under 4 x 0.25% interest rate rises within the 2yrs to become 'worse' than the 1.89% 5yr fix. It's worth anyone modelling their repayments against that. Also unlimited over payments allowed compared to 10% of the remaining balance on a fix (but realise this isn't a problem most of us have!).
Saying that, because I started the process early - I did manage to complete before my existing deal ended. However I would rather have paid a couple of hundred extra for a better solicitor.
Unlimited overpayments for FD, only 10% for year for HSBC.
Therefore, that 0.1% advantage could soon be lost with HSBC, if you can repay most of your mortgage before the end of the term.