HSBC’s offer to match the mortgage rate that their rivals borrowers are on when their deals finish might seem like an exciting offer on the surface, certainly bucking the current trend of increasing mortgage rates and reduced mortgage choice. But their “Rate Matcher” deal doesn’t come without caveats.
The first, and possibly most important, is that you’ll end up paying an arrangement fee for the privelige – and this will be dependent on the current rate you’re on. The better the rate, the higher fee you’ll pay, in some case this could add a few grand to your mortgage.
According to Fool, you’ll also have to meet the following criteria in order to be eligible:
- HSBC will rate-match homeowners’ existing fixed-rate deals, down to rates as low as 4.54% a year.
- Borrowers must have a deposit or existing equity of 20% of the property valuation.
- Rate-matching is only available on loans up to Â£250,000.
- Applications will only be accepted from borrowers with fixed rates due to expire before 30 June.
So on the surface it might seem like an interesting deal, but HSBC is aiming for a certain type of customer (unlikely to be first-time buyers), and also wants to make them pay for fixing their rate for two years.
If you’re still interested, the deal launches on 14th April and runs for 5 weeks. It might be worth looking at if you’re willing to pay the fees, but rather than going straight off to HSBC, try an independent mortgage broker first.
Update: The Telegraph has a very interesting Q&A on the HSBC deal.Â