HSBC or First Direct?

LeafGreen

I am an FTB in waiting with an offer on the table but not yet accepted. The best mortgage rates coming up on the net are trackers with HSBC and First Direct.

I have a very good deposit saved, clean credit record, good employment history etc etc, so I should be able to get the best available IRs (2.8%).

I know these two lenders are both part of the same group so terms seem quite similar, although opinions on here seem to be quite different - HSBC a pain, First Direct really good.

But are there any other factors I should take into account before deciding?

1. Is it a big disadvantage that FD do not have a high street presence, whereas I have a HSBC branch 10 mins away?
2. Do you have to send important documents through the post to FD?
3. I couldn't find any way to get an AIP with FD - is it possible? I was able to do an online one with HSBC.
4. I think FD require you to have their current account - could setting this up delay proceedings?
5. Anything else I might not have thought of?

Obviously as an FTB this is all new to me.
Thankyou.

The_J

If it was a choice between the two I'd go with First Direct.

HSBC customer service leaves a lot to be desired.

tilly78_2

My parents have a first direct mortgage and have had no problems, they also do all there banking with them and rave about them

I unfortaunately don't bank with them and applied for a mortgage which online said would be feasible, however after going through the application process they felt i didn't have enough of a disposable income for emergencies, therefore could only offer me lower mortgage amount than i asked for. They said it would have been easier if i had banked with them as they would have a record of my spending. I have now been fully authorised and offered a mortgage with another lender for 15k more than they would allow me to have.

Fingers crossed you get accepted.

bluestarlight

grahamgoo wrote: »

1. Is it a big disadvantage that FD do not have a high street presence, whereas I have a HSBC branch 10 mins away?
2. Do you have to send important documents through the post to FD?
3. I couldn't find any way to get an AIP with FD - is it possible? I was able to do an online one with HSBC.
4. I think FD require you to have their current account - could setting this up delay proceedings?
5. Anything else I might not have thought of?

Obviously as an FTB this is all new to me.
Thankyou.

1. Youc an use HSBC branches to bank with FD
2. Yes, if you send them registered, they return them registered.
3. Yes give them a ring, they will do it. They will also do a full mortgage application with you before you have found a house. This was great as we could move superfast when we found ours. You just ring back with the details of the house you have.
4. No it was quick, they sent everything out together. You dont have to use it for anything other than paying your mortgage, so we didnt have to change our main current account. Just transfer the mortgage money in each month.
5. I take it you have seen the Countrywide debacle with HSBC and their solicitors? I wouldnt go near them with a bargepole! FD do not make you use Countrywide.

We had a great experience as first time buyers, I cant recommend FD enough.

LeafGreen

thanks everyone - that's really useful, although it now looks like I may need to increase my offer by a few £K if it is to be accepted :-(

KTF

I am in the process of applying for the BoE + 2.19 tracker from HSBC (although it now seems to have gone up to BoE + 2.29 on their site) as the deals from FD were a bit higher than HSBC.

Applied over the phone and the paperwork arrived a few days later followed up by a courtesy call to check that I had received it, any questions, etc. so no problems there.

I took the required documentation to the branch to get it verified/sent by internal mail which was an option rather than sending it off to them to speed things up a bit as I knew the rate wouldn't last long.

So no problems with HSBC so far... Need to give them a call this evening to check that the rate has all been booked then nothing else to do until the end of September when my current fix ends.

bluestarlight

KTF wrote: »

So no problems with HSBC so far... Need to give them a call this evening to check that the rate has all been booked then nothing else to do until the end of September when my current fix ends.

I dont think the problem is with the HSBC mortgages, its with their solicitors when you are purchasing a house.

LeafGreen

A week or so down the line and I am close to agreeing a price with the vendor - this is good news as I was coming to the conclusion that it wasn't going to happen.

Bad news is that I spoke to First Direct a few days ago, and they had put up their IRs literally days before I called - Aggghhhhh!

So overall it's now 0.2% more with FD on their lifetime tracker compared to the HSBC one, although deposit requirement is 35% instead of 40%

From what I read on here though, I'm still thinking it's going to be better with FD than HSBC despite the extra 0.2%

Any thoughts? Has the HSBC situation improved post the end of the stamp duty holiday? Or do you agree FD are still the better option?

Thrugelmir

What will the additional 0.2% cost you over the term of the mortgage?

LeafGreen

well it's only about £12/month, but when you multiply that by 300 months then it does add up. but there again, maybe I will re-mortgage well before the end of the full term.

Thrugelmir

grahamgoo wrote: »

maybe I will re-mortgage well before the end of the full term.

HSBC in general has some of the best rates available. So don't expect these to be bettered by much in the future.

Remortgaging adds considerable additional cost as well. So best to plan for the long term.