HSBC UK has updated its policy on capitalising fees for mortgage applications, effective from today (Tuesday 5th November 2024).
Booking fees can now be added to the total loan amount, allowing the overall loan-to-value (LTV) ratio to exceed the limits set by the selected product and policy, as long as the LTV breach is only due to the added fee.
However, a booking fee cannot be applied if it causes the LTV to exceed the maximum limit of 95%.
This change applies to both residential and buy-to-let mortgage applications.
The UK residential existing customer switching range will see a decrease in the 2 year fixed fee saver at 60% LTV, while increases will occur for the 2 year fixed fee saver at 70%, 75%, 80%, 85%, and 95% LTV.
Additionally, the 2 year fixed standard at 60%, 80%, 85%, and 90% LTV will also increase.
In the UK residential existing customer borrowing more range, the 2-year fixed fee saver at 60% LTV has decreased.
Increases apply to the 2-year fixed fee saver at 70%, 75%, 80%, and 85% LTV, as well as the 2-year fixed standard at 60%, 80%, 85%, and 90% LTV.
For the UK residential first-time buyer range, the 2-year fixed fee saver at 60%, 70%, and 75% LTV has decreased, while it has increased for 80%, 85%, and 95% LTV.
The 2-year fixed standard at 60%, 70%, and 75% LTV has decreased, with increases for 80%, 85%, and 90% LTV.
The UK residential home mover range will see a decrease in the 2-year fixed fee saver at 60%, 70%, and 75% LTV, but an increase at 80%, 85%, and 95% LTV.
In the UK residential remortgage range, the 2-year fixed fee saver at 70%, 75%, and 80% LTV will increase, as will the 2-year fixed standard at 60%, 70%, 75%, 80%, and 85% LTV.
The international residential range will see increases for the 2-year fixed fee saver and standard at 60%, 70%, and 75% LTV.Â
HSBC UK will consider affordability based on the total loan amount, which includes any capitalised fees.
