HSBC's rescue mortgages loaded with large fees

Grovelawn Financial News 27/06/2008

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Steep rises in arrangement fees for homeowners

HSBC has come under fire for charging its customers, wishing to take out a "rescue" mortgage with them, high fees. Although a spokesman from HSBC has said the highest fees would be charged to customers on a worst case scenario, the fee of up to £9,999, for borrowers taking out large loans of up to £500,000, is one of the largest in the current market.

The increase in fees from last week for customers applying for a loan of £250k on a rate of 4.79 per cent who are currently not with HSBC have risen by 50 per cent to £7,699 from a previous charge of £5,000. The charge is calculated on the amount borrowed and the interest rate. HSBC offered rate matching deals to borrowers to help cusion the blow of rising rates during the credit crises, its decision to extend the offer for another six weeks has caused the fee to rise as mortgage funding has increased. A spokesman claimed the choice was to raise the arrangement fees, pulling the offer off the market or making a loss.

← QIA pumps billions into Barclays | News For June 2008 | £30 billion worth of fixed deals come to an end →

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