Posts Tagged ‘fixed-rate’

HSBC claims to have launched the only mortgage with a rate of less than 4% for first-time buyers and has also promised to make a further £350m available to borrowers with smaller deposits by the end of the year.

It latest mortgage offers a rate of 3.84% for two-years to borrowers with a deposit of between 10 and 15 per cent.

This is 0.1% lower than HSBC’s standard variable rate (SVR), which currently stands at 3.94%.

However at the end of the two-year period, the mortgage will move to the SVR which could be a significant disadvantage.

The cost of the mortgage could increase if HSBC decided to change its SVR, which it is entitled to do whenever it wishes.

First-time buyers who want the security of knowing their monthly repayments will remain at an affordable level might find a fixed-rate deal more suitable.

With the Bank of England base rate currently at 0.5 per cent, a tracker mortgage could also be an attractive option.

Tracker mortgage rates move in line with the base rate.

One advantage of HSBC’s latest offering is that there are no fees attached.

HSBC’s head of mortgages Peter Dockar said: “We recognise that first-time buyers need help so as well as great rates with no fee options, we offer our customers a free mortgage advice service in branch to help them get the right deal for them.”

Yesterday HSBC warned the Treasury Select Committee that the Independent Commission on Banking’s proposed reforms would cost it around $2.1 billion.

If the proposals go ahead and the bank is forced to raise extra debt capital as insurance against losses, it could move its headquarters out of the UK.

HSBC moved its headquarters from Hong Kong to the UK 20 years ago, after taking over Midland Bank.

Rent spikes are nothing new but for consumers who managed to score deals on rentals during the housing slump of 2008, the good times are just about over. 

The nation is currently seeing some of the highest occupancy rates since 2002, according to the National Renters Association. Fewer available tenements coupled with swarms of tenants flocking to fill them up means the ball is back in the landlord’s court and they’re shooting for the three-pointer. 

Some regions of the U.S. have already seen rental prices soar as high as 20 percent, an NRA spokesperson said. Luckily, that’s pretty unusual. Unless you’ve worked out a fixed rate with your landlord, consumers should typically expect about a 2 to 3 percent annual increase and budget accordingly. 

“A free market is a free market,” says Gary Malin, President of New York-based real estate brokerage firm CitiHabitats. ”People think there’s no possibility their owner could increase their rent, but they’re going to do what they can to maximize their rents.” 

The good news is there are plenty of warning signs out there that could alert you to rent hikes on the horizon. Here are some ways to eliminate the guesswork:

Shrinking classifieds. Keeping up with the general health of the real estate market in the press is the quickest way to gauge the possibility of rent increases, Malin says. If the classifieds section in your local paper is looking sparse in the rental department, it’s a good indicator prices will be steeper. 

“(Renters) need to go out and see what the market is,” Malin says. “They should engage a broker or go to open houses, go online and see what apartments are being advertised for and that will give you a sense of how the current rent stacks up in the marketplace.”

Electricity costs rising. Whether you’re in a doorman building or lying low in a basement apartment, you can bet your landlord will be paying hawk-like attention to the rising cost of keeping you warm in the winter.

Foreclosures spiking. Much of the boom in the rental market has to do with previous homeowners losing their houses to foreclosures or trying to downsize to cut expenses, according to the NRA. If there are reports of spikes in foreclosures, you can bet landlords will take full advantage of the sudden deluge of possible tenants and up their asking prices. 

A bulldozer is out front. If building managers or landlords plan any sort of improvement to their property, they often hike up rent to meet the cost of renovations. You may enjoy that nice new Jacuzzi in the backyard, but don’t think you won’t wind up paying for it eventually.

Lenders run scared. When banks start getting choosier with their risks like they have in recent months, it means fewer consumers will get approved for home loans. They’ll likely turn to the rental market instead until they can improve their finances sufficiently to secure a mortgage. 

Gas prices skyrocketing. When the cost of fuel rises, that means utilities across the board are likely to be impacted. Gas and heating costs are part of landlords’ operating expenses and play a big role in how much they’ll ask renters to pay, Malin says. 

Your landlord says so. Unless you live in a rent-stabilized apartment building and have a renter’s board to alert you to price increases, there are no laws that dictate how much notice tenants must be given. If you scored a great deal on a low-rent loft but your bank account can’t handle any extra expenses, ask your landlord in advance if they’re planning to up the rent so you can plan accordingly.  

Looking to buy rather than rent? Check out the pros and cons here >

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See Also:

• Here’s What You Need To Know About Renting Abroad
• Think The Bank Screwed You Over? Now You Can Get Your Foreclosure Reviewed
• Landlord Haggling You For More Rent? Here’s What To Do

Yorkshire Building Society has announced a new range of fixed-rate bonds paying interest at up to 4.6% gross/AER.
Customers can choose between two year, three year and five year options.
Interest is paid at 3.56% on the two year bond, 4.11% on the three year bond, and 4.6% on the five year bond.
Savers can apply for the [...]

Leeds Building Society has launched a new instant access five year bond paying interest at 3.5%.
Savers can access up to 50% of the money saved in the bond at any time without penalty.
Leeds said it designed the bond by looking at the other bonds available on the market and coming up with something unique.
“We believe [...]

Accord Mortgages has launched a new ten-year fixed rate deal with loan-to-value ratios of between 75% and 85%, and a starting rate of 5.24%.
The Yorkshire Building Society subsidiary has also made a number of rate reductions across its range, cutting five-year fixed rates by up to 0.5%, and two and three-year fixes by 0.35% and [...]