Strategic Finance
HSBC set to boost mortgage lending |
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| Strategic Finance | |
| Written by Gary Howes | |
| Thursday, 02 April 2009 | |
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Mortgage lending criteria reduced by HSBC while Nationwide data points to positive developments in the property market.
HSBC (LON:HSBA) has today announced plans to reduce the lending criteria on some of its best buy mortgages. It is also making its three-year fixed rate mortgage of 3.99% available to people with deposits or equity stakes of up to 25%. Nationwide housing market dataThe easing at HSBC comes as Nationwide releases data showing that the worst could be over in the housing market. House prices rose in March for the first time since October 2007, according to the Nationwide. The building society said that property prices increased by 0.9% compared with the previous month. That reduced the annual rate of house price falls from 17.6% in February to 15.7% in March, with the average UK home costing £150,946. £15 billion allocatedThe bank estimates that 20% of mortgage holders in the UK have equity in their homes equivalent to between 25% and 40% of their property's value. It said the changes, which will come into force on Monday, would enable an extra one in five people to apply for one of its leading rates. But homeowners will still need a deposit of at least 40% in order to qualify for its 2.89% two-year fixed rate deal or its 2.49% discounted one. HSBC has allocated £15 billion for mortgage lending during 2009, double the level it lent in 2007. Martijn van der Heijden, head of mortgages at HSBC, said: "By widening our maximum loan to value percentages to 75% on some of our best buy mortgages, over two million more homeowners can now apply for them." Meanwhile, Abbey is launching a new four-year fixed rate mortgage of 5.84% for first-time buyers on Friday. The deal is available to people with a loan to value ratio of up to 85%. There is a £495 arrangement fee, but people will get £250 cashback on completion
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