Aggressive HSBC promises to match existing mortgage
By Damian Clarkson     09th April 2008

HSBC is offering cash-strapped homeowners a lifeline by promising to match their existing fixed rate deal when it comes time to re-mortgage.

The offer expires in five weeks and is only available to customers who are coming off a fixed rate mortgage and who own at least 20% of the equity in their home.

Furthermore, HSBC will only match loans for up to two years and most eligible candidates will have to pay a fee in the region of £999.

Yet despite these restrictions, the deal will no doubt prove popular with homeowners given the dire state of the mortgage market at present.

It is estimated that some 1.4 million customers are coming off cheap fixed-rate deals this year and will face sharp rate increases from their existing lender.

Compare fixed rate mortgages here

HSBC bucks the trend
The bank clearly feels it has a golden opportunity to capitalise on the woes of its competitors and grow its miniscule 3% share of the market. Most mortgage lenders suffered massive losses from exposure to the sub-prime market, but because HSBC has a relatively small customer base it has escaped largely unscathed.

Secondly, while most lenders are struggling to find sufficient cheap credit to offer customers, HSBC, as Britain’s largest bank, is better equipped to take on the additional load of new mortgage business.

The bank has launched a two year fixed deal with a rate of just 4.99% to coincide with its latest announcement, placing it at the top of all mortgage best buy tables.

This move provides further evidence that HSBC is planning an aggressive thrust into the mortgage space – until now the bank has been notable only by its absence from the mortgage charts. Compare fixed rate mortgages here

It all sounds good, but…
There’s no doubt that competitive mortgage deals are fast drying up, but it’s important you avoid the temptation to simply flock to HSBC.

Not only is their offer limited to two year fixes (at a time when the popularity of trackers is growing), but it’s entirely possible you’ll find a cheaper deal for your unique situation elsewhere.

So make sure you scour the market for competitive deals – choosing a mortgage is far too big a decision not to.

Article produced by EveryInvestor.co.uk