HSBC is launching a 3.79% two-year home loan "special" interest rate, which the bank says is the lowest ever rate it has offered in New Zealand.
The catch is the offer is only available to owner-occupiers who are HSBC "Premier" customers. The bank's Premier customers must have either a minimum combined home loan of NZ$500,000, or NZ$100,000 in savings and investments with HSBC.
HSBC says the 3.79% two-year offer is being made to new Premier customers, and existing Premier customers who borrow at least an additional NZ$100,000. To qualify, these customers must provide an owner-occupied property as all or part of the loan security. Minimum deposit and equity criteria also apply.
“This market-leading 3.79% p.a. two-year-fixed home loan rate provides owner-occupiers with a great opportunity to refinance their mortgage with HSBC. Our consistent track record of offering attractive home loan rates in New Zealand should also reassure them about refinancing with us,” said Glen Tonks, HSBC NZ's head of retail banking and wealth management.
"This 3.79% p.a. ‘special’ interest rate for two-year-fixed tenor is its lowest-ever residential mortgage rate in the New Zealand market, trumping the 3.95% p.a. for the 18-month-fixed tenor the Bank launched on 17 February 2016, which at the time was the lowest residential mortgage rate in the New Zealand market for over 50 years," Tonks said.
The next lowest carded, or advertised, two-year bank rate is SBS Bank's 4.15%. TSB Bank has a 4.19% rate, while ASB, BNZ, the Co-operative Bank, Kiwibank and Westpac have 4.29% offers, and ANZ 4.35%. See all banks' carded, or advertised, home loan rates here.
HSBC is also reducing its Premier floating home loan rate by 16 basis points to 5.59%, and its Premier revolving credit home loan rate by 10 basis points to 5.79%.
The new rates take effect today (Wednesday).
| Floating | Prior rate | New rate | Change | effective from |
| % | % | % | for existing clients | |
 |
5.64 | 5.59 | -0.05 | 29 August 2016 |
 |
5.65 | 5.55 | -0.10 | 24 August 2016 |
 |
5.69 | 5.64 | -0.05 | 29 August 2016 |
 |
5.45 | 5.25 | -0.20 | 29 August 2016 |
 |
5.75 | 5.65 | -0.10 | 31 August 2016 |
 |
5.45 | |||
 |
5.75 | 5.59 | -0.16 | 17 August 2016 |
| ICBC | 5.60 | |||
 |
5.69 | 5.54 | -0.15 | 18 Sept 2016 |
 |
5.54 |
44 Comments
The 'special' rates from the other banks get discounted further. It is a sharp rate but when others are offering 4% it isn't that much more. They are also cherry picking customers, although $500k mortgage on your own house is quite high and existing customers only get the new rate if they borrow another $100k or more. I also imagine there are no cash backs or steak knives etc included with it. I know someone who got 4.04% for 2 years and got $9k cash back on $750k in the last month or so.
I see a report on BLOOMBERG that the big UK banks are getting ready to domicile their head offices outside the UK (London ).
We should be really cheeky and offer them incentives to set up their head offices right here in Auckland .
Now that will get us off the low wage rung which has held us back
except that while the interest rate would be lower, arguably the actual payment wont be , because cheap credit drives house price inflation so 2.5% on a loan twice as big as it should be is not better!
Not to mention no one will save when the savings interest rate = 0%, so trouble getting funding, so the cycle continues.
Let's take singapore as an example : can get loan rates for 2.50% there. Guess the 1 year TD rate... 0.25%, wow, how generous. Or what about a 5yr TD for 0.75%! Yikes.
Awesome rates HSBC! We left an Aussie bank earlier this year for
HSBC and while their digital platforms and customer service are from the dark ages that is irrelevant when my mortgage repayments have literally halved. The big four are like a cartel seriously someone should investigate their often similar front desk approaches when customers are shopping around for a mortgage - it's surely anticompetitive- none in the big four will go sub 4%, all offer cash but bonded to a set year to loan size ratio but no problem for HSBC to bring first world interest rates to NZers.
Their rates aren't half the majors, so presuming you fixed in earlier at a much higher rate. If you factor in no cash (even though there are costs to refinance) the offer is no better than others unless you have a massive loan. As an existing HSBC customer you cant even get that rate unless you add $100k in debt... (false economy) ... that's a bit stink!
- This is all interesting reading . Having previously worked for one of those large Australian banks for over 30yrs, it continues to amaze me, that the population of property owners who bank with these firms, continue to accept the cash payments for moving your mortgages to them and inevitably between them. The banks offer cash towards solicitors costs or simply a cash contribution and you all will have supposedly signed an acknowldgement that if you refinance in 3 yrs you will be required to pay this back. The payback, I believe isn' t really an issue ,because your next anticipated bank cash payment will probably cover the payback of the last one you got. The cash contribution the bank pays you compared to what they will take off you over a 25yr term is laughable. Best way to beat a ban,k is start minimising the interest dollar they are taking off you. Start trying to pay off as much or as little in additional principal payments that you can. Every dollar off a loan balance for as long as possible allows you to avoid paying more interest on interest in the long run. Start giving it a go and stop grizzling about interest rates and do something about the level of interest dollar they charge you. The banks make interest on your interest in your mortgage.
I endorse this approach. On iOS there's an app called loanCalculator that shows total interest paid for the life of a loan. If people focus on reducing the total interest paid over the course of the entire loan the interest rates diminish in importance. Of course if people do the math they will see that a shorter term and higher payments can make a difference in the order of hundreds of thousands of dollars in interest.
absolutely! as with all debt, the sooner gone the better. When rates are at historical lows, best to pay max. The danger of all these Aucklanders who think they're millionaires is they start using their mortgages as ATMS and end up way worse off over the long run. Nuts.
I hope someone with more knowledge than me can clear this up . I know the banks used to show you paying the interest off on the whole term before paying any capital off . For e.g you pay of the interest for 20 years and the last 10 years pays off the capital amount . But I dont believe you are actually charged this, providing you are paying more than just the interest on the capital amount. Your montkly payment pays the interest for that month , plus any extra you pay comes off the capital amount . So how are you paying interest on interest ?( apart from possibly between when the interest for the month is calculated , and when you actually make your payment?
Sorry, don't agree that paying off debt is the correct thing to do in some instances!
There is good debt and bad debt.
Providing the debt is purchasing assets that are producing more income than you are paying in interest then
You are going forward.
Leveraging is the only way to go when you are getting returns of 8 to 10 per cent and you are not having to put
Any of your own money in.
The worlds financially most successful would agree with me.
However if you are negatively geared then yes pay off the debt as quick as unless you have got better use for the money.
name these financial Gurus that tell you to take on debt and I will match you with the one guru that calls all debt bad
warren buffet
http://www.buffettsecrets.com/warren-buffett-debt.htm
-Solardb: If you have a normal table mortgage based on a repayment of Principal and interest with a frequency of Fortnightly or Monthly , you will see when you make the loan payment into your loan account your loan balance will reduce by that payment. The next thing you see, will be the amount of interest come out of the loan account which goes to the bank and accordingly you will see your loan balance increase by the amount of that interest calculation for a fortnight or a month . I.e. The loan balance less your payment plus the banks interest will equal your new loan balance. The bank calculates interest based on your loan balance and that loan balance now consists of the interest amount they just debited to your loan account. So if you had a $100 loan and your payment was $10 and of that $10 , $2 was interest. your loan balance after your payment would be $92. The bank begins calculating interest on the $92 not the $90. I hope that helps :-).
- There are a few ways of avoiding that interest on interest but for some it can prove quite tough based on the level of payment or the type of loan you need to put in place. Hence the comment if you can reduce that table mortgage loan balance as much or as little as possible and keep it that way and as often as you can your interest dollar cost in the long run can be greatly reduced.
- There are a few ways of avoiding that interest on interest but for some it can prove quite tough based on the level of payment or the type of loan you need to put in place. Hence the comment if you can reduce that table mortgage loan balance as much or as little as possible and keep it that way and as often as you can your interest dollar cost in the long run can be greatly reduced.
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