"HSBC continues as one of the few lenders actively seeking to steer the mortgage market at the moment. Its decision to cut the rates on its loans available up to 90 per cent is great news for first time buyers trying to get onto the housing ladder and existing borrowers who don't have much equity in their home.
"HSBC's new deals are by far the most competitive in the 90 per cent lending bracket - topping other providers by between 0.5 and 1.4 percentage points. Let's just hope HSBC's move will spur other lenders into taking action resulting in an increase in the number of competitive mortgage rates for those with smaller deposits.
"However, as ever, there is no such thing as a free lunch, or in this case a cheap mortgage without caveats. HSBC current account customers and those not currently with HSBC will have to open a HSBC Plus current account at a cost of £12.95 a month for a minimum of 12 months to get access to these deals.
"It's also worth noting that the 90 per cent two-year fix at 4.99 cent won't be the cheapest option for many borrowers. The booking fee on this product is high at £1,499. Anyone borrowing less than £180,000 would actually be better off opting for the two-year fix at 5.49 per cent - the rate may be higher but the booking fee is just £199 making it better value for loans below that amount. "
Lender - Rate Type - Pay Rate - Period - Max LTV - Arrangement / Booking Fee
HSBC - Customers Only (with effect from 14.04.09) - Tracker - 4.59% - (4.09% above base) - Term - 90% - £999
HSBC - Customers Only (with effect from 14.04.09) - Fixed - 4.99% - 2 Years - 90% - £1,499
HSBC - Customers Only (with effect from 14.04.09) - Fixed - 5.49% - 2 Years - 90% - £199
Yorkshire Bank - Fixed - 5.99% - 30-Jun-11 - 90% - £999
Post Office - Fixed - 6.01% - 31-May-14 - 90% - £599
Cheltenham & Gloucester - Fixed - 6.29% - 31-Aug-14 - 90% - £994
NatWest - Fixed - 6.39% - 31-May-11 - 90% - £799