HSBC has announced a new deal offering a substantial £1,500 cashback incentive for first-time buyers, alongside reductions to its fixed-rate mortgage products. The banking giant has cut selected residential mortgage rates by up to 0.29 percentage points, with its five-year fixed-rate option for purchasers with a 5% deposit now standing at 5.37%. This package is particularly attractive as it includes £1,500 cashback, a complimentary valuation, and no product fee.
Benefits for First-Time Buyers
These benefits could assist cash-strapped buyers facing hefty upfront costs when purchasing their first property. The offer was highlighted by Moneyfacts as one of its financial 'Picks of the Week', receiving an 'Outstanding' product rating. Caitlyn Eastell, personal finance analyst at Moneyfactscompare.co.uk, commented: "The deal also offers a lucrative incentive package which includes a free valuation, £1,500 cashback and no payable fees, which may make this an ideal option for first-time buyers looking to keep costs to a minimum."
Market Competition
The development comes as lenders continue to compete for market share amid expectations that borrowing costs could fall further in the coming months. Nevertheless, mortgage borrowers still face rates considerably higher than those available before the inflation and interest-rate surge that followed the pandemic.
Buy-to-Let Rate Reductions
Landlords also benefit from reduced rates. HSBC has cut rates on selected buy-to-let mortgages by up to 0.09 percentage points. Its five-year fixed-rate mortgage at 65% loan-to-value is now on offer at 4.57% for second-time landlord borrowers. The deal comes with a substantial £3,999 product fee but includes a free valuation and allows overpayments of up to 20%. Moneyfacts noted that the rate cut helped secure its position as a Best Buy product.
Savings Market
Savers can pocket more than £900 tax-free. The latest competition isn't limited to mortgages. Savers looking to shield their cash from the taxman can now lock in a market-leading 4.67% on a one-year fixed-rate cash ISA from Secure Trust Bank. Those depositing the full £20,000 annual ISA allowance could earn more than £900 in tax-free interest over the term, according to Moneyfacts. The account can be opened with a minimum of £1,000 and permits additional deposits for 30 days after opening. However, customers requiring early access to their funds face a penalty equivalent to 90 days' interest and must close the account. Ms Eastell said: "The boost to the one-year option sees the account pay a market-leading 4.67%."
Personal Loan Rates
Borrowers have also been presented with a fresh choice despite higher rates in certain areas of the loan market. M&S Bank has raised the rate on its personal loan range for borrowing between £7,500 and £25,000, pushing the representative APR from 5.7% to 5.9%. Despite the rise, Moneyfacts noted the loan remains one of the most competitive options on the market. A key benefit is that borrowers are able to make overpayments without incurring an early repayment charge, which could help cut the overall interest bill.
Experts continue to advise consumers to shop around before committing to any financial product, as rates and incentives can differ considerably between lenders. The latest batch of deals highlights how banks are increasingly turning to cashback offers, fee-free packages and headline rates to win over customers in an ever more competitive marketplace.
