HSBC Joins UK Banks In Cutting Mortgage Rates
HSBC has joined two other major lenders in reducing mortgage rates following hints of a summer base rate cut by the Bank of England.
Barclays cut the cost of its fixed-rate home loans for new deals on Tuesday, following an earlier move by NatWest.
HSBC's cuts will come into effect on Wednesday, with brokers expecting more mortgage companies to follow suit.
However, these reductions are small in the wider context. Borrowers still face relatively high costs, with many paying significantly more in monthly repayments when current cheaper deals expire.
Average mortgage rates had been creeping up, driven by a lack of fresh competition between lenders during the election campaign.
The average rate on a two-year fixed deal stands at 5.96% according to the financial information service Moneyfacts. It said the average five-year deal had a rate of 5.53%.
Although spring tends to bring more activity in the housing market, this may have been dampened as potential buyers wait for more political certainty.
Borrowers will also be watching for whether the Bank of England's Monetary Policy Committee (MPC), which sets interest rates, opts for a cut at its next meeting on 1 August.
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