Hot on the heels of Kiwibank slashing its six-month fixed home loan rate, HSBC has cut its six-month rate, with strings attached, even though it was already lower than Kiwibank's new rate.
HSBC has cut its rate from 5.74% to as low as 4.99% if the customer also takes out a home and contents insurance policy with the bank.
If they don't take out an insurance policy, they still get a cut to 5.49%. HSBC's rates are only available to those with combined mortgages of $500,000 or at least $100,000 invested with it, known as "premier" customers.
"Since April last year, HSBC has offered our HSBC premier customers some of the lowest fixed rates in the market and we're looking to take an aggressive and competitive rate offering again in 2011," said John Barclay, HSBC's head of personal financial services.
"Many New Zealanders are still finding the economic climate tough and these low rates are our way of helping them increase the equity in their homes which then allows them to consider alternative investment or lifestyle options," Barclay said in a statement.
Given HSBC's criteria, presumably its customers are better placed than most to weather tough economic times.
HSBC said customers on its 4.99% rate could save $3,175 in interest on a $500,000 home loan over six months that they would pay if they had six-month fixed loans at the average rate offered by the four major banks and Kiwibank.
It estimates that average rate at 6.26% based on GoodReturns' rates at 8.30am on February 18.
Yesterday, Kiwibank slashed its six-month rate by 40 basis points to 5.95% for a limited period.
Kiwibank's previous two-year fixed rate of 6.35% matched those of ASB and ANZ National but was above Westpac's at 6.25%. BNZ offers two six-months fixed rates, 6.3% and 6.4%
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