The popularity of HSBC's two year fix can be seen in a doubling of the bank's mortgage application requests in February compared with January 2009.
The early repayment charge declines by 1% for each year of the loan, to zero at the end of the fixed period. In addition, for those borrowers keen to pay their mortgage down quicker, all HSBC fixed rate customers can overpay the equivalent of 20% of their monthly payment each month without incurring any ERCs.
Martijn van der Heijden, head of mortgages at HSBC commented, "The clear feedback we have received from customers is that they now want to lock into today's historically low interest rates. Base rates don't have much further to fall, so demand for longer term fixed rate mortgages is increasing. Anyone looking to take out our 2.99% two year fixed rate needs to move quickly as it is only guaranteed to the end of the month."
