HSBC cuts mortgage costs for first-time buyers | Money | guardian.co.uk

HSBC cuts mortgage costs for first-time buyers | Money | guardian.co.uk

HSBC has cut the cost of borrowing for first-time buyers with the lowest two-year mortgage deal available for those with a deposit of 10%.

The bank is offering a 3.84% two-year discount deal with no fee to pay – and claims this is the only mortgage with a rate of less than 4% for first-time buyers.

For the first two years the rate will be 0.1% below the bank's standard variable rate (SVR), which is currently 3.94%. After that, buyers will switch on to the SVR.

HSBC said the product will provide additional help to prospective buyers with smaller deposits who have been unable to find a mortgage. Head of mortgages Peter Dockar said: "We are committed to supporting first-time buyers and last month we pledged to make a further £350m available to borrowers with equity or a deposit of 10%-15% by the end of the year."

But Andrew Hagger of Moneynet.co.uk warned: "The downside with this deal is that it is linked to HSBC's SVR which can be altered by the bank at any time, unlike a base rate tracker