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HSBC offers Ratematcher to remortgagers

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by Gill Montia

HSBC fixed-rate mortgage borrowers are being told that the bank will match their current interest rate when they remortgage.

The large numbers of homeowners coming to the end of their fixed-rate terms during the coming year has fuelled speculation of a property price crash with high levels of repossession and the bank’s actions will be reassuring to customers fearing “rate-shock” when their, two, three or five years loans end.

The offer will help borrowers on fixed-rates as low as 4.6% deal with the impact of recent interest rate rises.

It will only apply to those ending fixed-rates terms before the end of April, although the RateMatcher deal could be extended further into the year.

Remortgagers will be changed a fee, but could secure rates below those charged by the current “best-buy” lenders, many of whom are charging £1,000 or more in arrangement fees.

HSBC’s charges will be dependent on the size of the loan, for example, a £499 fee for a £43,500 4.99% two-year fix; £999 for a £120,000, 4.95% two-year fix.

Larger loans or mortgages with high loan-to-value ratios will be assessed on an individual basis.

Martijn van der Heijden, HSBC’s head of mortgages, said: “The Bank of England has warned debt repayments as a proportion of household income are at a 15-year high, and with 1.4 million homeowners facing steep increases in mortgage payments in 2008, this stretch is likely to become worse.”

Financial website, This is Money has applauded HSBC’s action saying: “HSBC is actually doing something that most financial institutions pay lip service to but rarely achieve – rewarding existing customers. Many HSBC borrowers will be able to get a better rate at a lower fee than they would do elsewhere. Let’s hope they continue the offer beyond April.”

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News posted: February 1, 2008

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