HSBC "amazing" new deal...

[Steel_Tomb]

http://uk.biz.yahoo.com/03092009/389/hsbc-launches-cheapest-mortgage.html

1.99% interest... sounds great doesn't it. Only catch is you need a minimum of 40% deposit. I mean who the **** has say about 80 to 90 thousand quid to put down as a deposit these days. They want the deal to encourage competition between other banks looking to grab customers attention, but whats the point? I honestly don't see the point of having deals which are quite simply out of reach of about 75% of people at the moment. I would like my own place in a few years, but the lowest deposit HSBC would want is 25% of the property price upfront. Its rediculous first time buyers are being completely priced out of the market. The way things are at the moment, I'll never get on the property market even with a half decent job. Even if I was earning 30k a year (which I'm not, just got made redundant!) BEFORE the fat taxman gets his grubby mits on it, it would take me about 5 to 7 years to save up enough money just for the deposit.

/rant :damn:

[Tarrasque]

That's ignoring the fact as well that you have to go with HSBC.

Given they've just driven my father away from them who had an account with them for 34 years, due to to their rudeness, their incompetence and their complete lack of customer service, I would rather trust someone like Landsbanki or Fannie Mae with my mortgage!

[Tchocky]

It'll save you money, provided you're stinking rich already.
Gawd

[Tribesman]

Only catch is you need a minimum of 40% deposit
That sounds about right.
I mean who the **** has say about 80 to 90 thousand quid to put down as a deposit these days.
People with 80-90 grand.
but the lowest deposit HSBC would want is 25%
Thats the way it should be.
Its rediculous first time buyers are being completely priced out of the market.
First time buyers are priced out of the market because the very low deposit requirements (or even no deposit) on mortages over the past 30 years have seriously overinflated the price of a house.
The way things are at the moment, I'll never get on the property market even with a half decent job.
The way things are at the moment its the perfect time to by property.
You find a house that some idiot bought with little or no deposit which he has now lost and buy itoff the lending agency that has taken it back and you only pay a fraction of the current low market value.

But of course you will need money , have you considered saving up for 6 or 7 years?
it would take me about 5 to 7 years to save up enough money just for the deposit.

Ah , so you do realise that you have to save . After all a house is a big investment , you can't just jump into it tomorrow without planning for it a long time in advance.
Take advantage of those idiots who lost their houses that they bought when they shouldn't have even considered buying.

[mookiemookie]

Looks like the "gotcha" here is the arrangement fee which potentially eats up any savings the low rate gives you. Not to mention that the BOE's rate is at .5% meaning your mortgage can only go up from there once the teaser rate period is done.

Amazing how banks still engage in the very same practices that got them into trouble in the first place.

[August]

If that deal were available to me 3 months ago I could have saved myself 3% on my mortgage. Still 4.97% isn't bad...

[Jimbuna]

HSBC should be forced to post a financial health warning to all their adverts......not one of the best lenders in the UK IMHO by a long stretch :nope:

[GoldenRivet]

1.99% interest... sounds great doesn't it. Only catch is you need a minimum of 40% deposit. I mean who the **** has say about 80 to 90 thousand quid to put down as a deposit these days?

well it is a trade off... you can get a higher interest rate with a lesser down payment as well. but think of a down payment this way... a down payment is liquid cash you simply lose that you could have used for other things.

for example i just purchased a truck recently... i had the choice of paying about $27,000 after tax, with no money down and a 2% interest rate.

OR

i had the choice of paying $21,000 after tax with no money down and an 8.9% interest rate.

the interest his high, but the principal is less... also im out no money down so i can use my down payment money as a cushion to pay for the first few months of ownership premiums and maintenance etc.

of course this is for housing...

My wife and i have been saving and building our assets for 7 years... i would say we are about 70% of the way saved up for a home downpayment.

the hard part about being in your 20's is that nobody takes you seriously on a financial note unless you have a near perfect credit score and a substantial and often unrealistic income.

they view you as just some "kid".

what i did to build credit through my teens and twenties was to go out and take advantage of all of those 0 payments for 12 months, 0% interest for 12 months type of deals... and i saved up my money until it was equal to the principle... when the first bill came in the mail - i paid the whole loan off.

i was the only 21 year old on my block with a credit score in the 700s, of course im sure it is shot now... simply because of all of the business related borrowing i had this year. (thankfully im nearly out of that too)

virtually every homeowner i know spent the first 5 to 10 years of their professional lives saving up for a down payment.

it takes time to build an empire :up:

[Tribesman]

the hard part about being in your 20's is that nobody takes you seriously on a financial note unless you have a near perfect credit score and a substantial and often unrealistic income.

The problem I encountered at the start was having absolutely no credit rating at all as I had never taken a loan or used a credit card . Income and money in the bank they wouldn't even consider in the mortgage equation without a debt history.
I see you got round that by using cards.

[GoldenRivet]

yes, but you have to use those cards sparingly.

everyone knows that a young person is more likley to get a credit card and then hock themselves into oblivion buying useless crap.

what you must do is buy things once in a while with the credit cards, and make timely payments in full.

this seems to be catching on as there are a couple of young early 20's guys at my flight school who pay for $1,000 in training up front... then they save up their money until the bill arrives and they pay it off in full.

this does wonders for your credit score because you establish yourself as a responsible and reliable borrower.

[Tribesman]

what you must do is buy things once in a while with the credit cards, and make timely payments in full.

Or tell the bank to stuff their credit rating take your money out of the bank and just buy a house

[GoldenRivet]

Or tell the bank to stuff their credit rating take your money out of the bank and just buy a house

that only works if you have upwards of $200,000 in the bank :up:

and - on the off chance that you do

you have spent all your money on the house and you now cant furnish it, get power or water hooked up etc.

as you are now broke :haha:

[Tribesman]

that only works if you have upwards of $200,000 in the bank
Read the earlier post , take advantage of the property cycles and profit from other peoples stupidity.