The Hongkong and Shanghai Banking Corporation will once again roll out new fixed-rate home loan plans, with an annualized interest rate as low as 2.73 percent, as the US Federal Reserve hints at a potential cut in September.
The lender will offer two plans – one for three years and another for five – highlighting that the annualized rate is lower than 3.5 percent for prevailing schemes linked to the Hong Kong Interbank Offered Rate.
Taking a 30-year HK$5 million home plan as an example, a home buyer who chooses HSBC’s plans must repay HK$20,359 per month, HK$2,093 or 9.3 percent less than prevailing Hibor-based plans, according to mortgage consultancy firm mReferral Mortgage Brokerage Services.
Moreover, the rate of HSBC’s new plans is at least 1.61 percentage points lower than that of the 10-year scheme offered by the Hong Kong Mortgage Corporation, mReferral noted.
Eric Tso Tak-ming, chief vice president of mReferral, said HSBC’s new plans will help lock lower interest rates in advance as Hong Kong banks may not slash their prime rates despite a cut by the US’ central bank in September.
HSBC will also offer cash rebates for applications made from yesterday until December 31, with a required drawdown date no later than the end of April 2026.
At the end of the fixed-rate period, both the three- and five-year plans will automatically switch to a floating rate – the prime rate minus 1.75 percent.
In addition, HSBC has shortened the penalty period to the first two years for the three-year plan and three years for the five-year option, starting from the loan drawdown.
This follows significant fluctuations in the mortgage-related one-month Hibor this month, jumping from the lowest 0.87774 on August 4 to 2.85774 percent on August 20. It stood at 2.7272 percent yesterday.
STAFF REPORTER
