HSBC has cut its mortgage rates, following several weeks of rate rises from most major lenders.
asserted
HSBC → cut → lenders
The bank has lowered its rates by up to 0.19 percentage point, taking some of them below the 5 per cent mark.
asserted
bank → lower → mark
Mortgages in that bracket almost disappeared over the last month, with only nine left on the market in early October according to Moneyfacts.
uncertain
nine → disappear → Moneyfacts
Average fixed rate mortgages are hovering just shy of 6 per cent, putting pressure on those currently buying or needing to remortgage.
asserted
mortgages → fix → those
HSBC's cheapest two-year fix is now at 4.99 per cent for anyone remortgaging with at least 40 per cent equity.
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fix → remortgage → equity
The deal comes with a £999 fee, and on a £200,000 mortgage being repaid over 25 years would cost £1,168 a month.
asserted
deal → come → 1,168
For those buying with at least a 20 per cent deposit, HSBC is offering a two-year fix at 5.19 per cent with a £999 fee and £250 cashback – one of the best on the market.
asserted
HSBC → buy → market
HSBC now has some mortgage deals below 5% interest
Are there more mortgage rate cuts to come?
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HSBC → have → cuts
At the beginning of the year, most borrowers were able to get rates below 4 per cent with two-year fixes going as low as 3.5 per cent.
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fixes → get → cent
The Bank of England was previously forecast to cut the base rate of interest throughout 2026 because inflation was on a downward trajectory.
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inflation → forecast → trajectory
Cutting the base rate reduces borrowing costs for lenders and would result in mortgage rates falling.
However, the escalation of hostilities in the Middle East and resulting rises in energy costs have led to fears of higher inflation being stoked once again.
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escalation → cut → inflation
While the Bank of England held base rate at 3.75 per cent in September, the sixth consecutive hold since December 2025, it is now anticipated that it will raise interest rates.
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it → hold → rates
It is not entirely clear why HSBC has cut its rates today.
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HSBC → cut → rates
Mortgage lenders must balance their own borrowing costs and profit margins with the need to have attractive rates that draw in new customers.
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that → balance → customers
Mortgage brokers think the latest cut could encourage competing lenders to follow.
However, in general, mortgage experts think that rates won't experience any dramatic falls for some time.
uncertain
rates → think → time
Justin Moy, managing director at Chelmsford-based EHF Mortgages, said: 'The market feels like it has plateaued over the last week or so, still around 1 per cent more than we were just a few months ago, but to see HSBC move will encourage other lenders to follow over the coming days.'
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we → base → days
Aaron Strutt of broker Trinity Financial, added: 'With so much talk of base rate rises and the war in Iran dragging on it seems unlikely fixed rates will get a huge amount cheaper but the mortgage market is notoriously hard to predict.
'
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market → add → Iran
For those buying with a 40 per cent deposit, Yorkshire Building Society has a 4.83 per cent two-year fix with £1,495 fees, or a 4.95 per cent five-year fix.
asserted
Society → buy → fees
Santander has a 4.92 per cent two-year fix and a 4.93 per cent five-year deal, both with £1,499 fees and £250 cashback.
asserted
Santander → have → fees
As for those remortgaging, Yorkshire Building Society has a 4.96 per cent two-year deal or 5.05 per cent five-year fix.
asserted
Society → remortgage → deal
For those considering a tracker deal, Barclays has a 3.99 per cent two-year rate according to Trinity Financial.
uncertain
Barclays → consider → Financial
Trackers follow the base rate, plus or minus a certain percentage – so they could be a risky move at the moment with the base rate potentially set to rise.
Lloyds Bank and Halifax are offering 4.06 per cent two-year trackers while Nationwide has a 4.09 per cent deal.
uncertain
Nationwide → follow → deal
If the base rate rises, these deals will increase by the same margin.
asserted
deals → rise → margin
Halifax is also offering many of the cheapest deals to higher earners and Lloyds Premier bank account customers with three-year fixes from 4.87 per cent and five-year fixes from 4.82 per cent.
asserted
Halifax → offer → cent
The Aporia
