HSBC has withdrawn all its mortgage deals for new customers after being swamped by applications from borrowers rushing to refinance before rates rise even higher.
The lender gave borrowers just four hours’ notice yesterday that it was going to pull its new business, residential and buy-to-let offers at 5pm.
However, it was forced to shut up shop even earlier at 3.30pm after receiving a flood of inquiries. No mortgage products will be available to new customers of HSBC until Monday.
Homeowners and buyers have rushed to lock in deals as rates keep increasing amid the ongoing turmoil in the mortgage market.
Banks and building societies have pulled hundreds more home loans since May 24, when official figures revealed that inflation had remained higher than expected – 8.7 per cent – in April. Economists believe the Bank of England will need to increase its base rate – currently at 4.5 per cent – to 5.5 per cent in an attempt to tame inflation. David Hollingworth, of mortgage broker L&C, said: ‘Lenders are having to make tough decisions because the market is moving so quickly.
The lender gave borrowers just four hours’ notice yesterday that it was going to pull its new business, residential and buy-to-let offers at 5pm
‘We haven’t seen such a big lender withdraw rates like this in 2023, it is quite radical.
‘HSBC was at the top of the buy list because they hadn’t repriced in a whole week. It’s no wonder it was inundated, and it just shows the speed rates are moving at.’
HSBC said: ‘To ensure that we can stay within our operational capacity and meet our customer service commitments, we occasionally need to limit the amount of new business we can take each day.’
Most lenders have already raised rates on fixed deals or pulled deals from the market, including Halifax, which hiked its deals by up to 0.82 percentage points. Santander increased rates by up to 0.43 percentage points over the weekend. Barclays, NatWest and Nationwide have also increased mortgage rates.
Justin Moy, of EHF Mortgages, said lenders were tactically pricing their deals out of reach on the expensive side, as a shield to avoid being inundated by new applications.
