Mortgage Advice: Discount or Tracker

onewton

I am just taking on a less than 60% LTV mortgage to buy a house having rented for some time.

I am chosing between two options at HSBC that i have whittled it down to:

1. Discount: HSBC SVR (currently 3.94%) less 1.45% = 2.49% for 2 yrs
2. Tracker: Bank Base Rate (currently 0.5%) plus 2.24% = 2.75%

Obviously the first option is lower, but I had a few thoughts:
1. Is there a risk that HSBC could increase their SVR by more than the base rate changes?
2. Is there a chance that they could increase it by less (for example, if their SVR is higher than others (eg Lloyds and Abbey) and they were bringing it down)?

If anyone has any view on the likelihood of these or how HSBC has behaved in the past, that would be great.

Many thanks
OPEN

opinions4u

They can do whatever they choose whenever they choose with their SVR.

Prior to the credit crunch their SVR was one of the lowest.

It's now at the higher end of the mainstream lenders.

herbiesjp

The margins banks are making on mortgages are the highest they have been at the moment

Give them an excuse to put rates up, and they will try to increase thse margins as much as possible IMO.

So a raise in rates will mean SVR increases, equal to, if not greater than than the actual BoE change (again IMO)

onewton

Thanks - if anyone has any other views on what HSBC aare likely to do with their SVR, that would be greatly appreciated.