HSBC has reported that the new products will come with no maximum lending limit. Both mortgage products will offer customers the ability to link their mortgage interest payments to the balance of their HSBC Premier savings account in the form of a deposit-linked loan, what is known as a balance-offset mortgage. Using this option, the rate of interest is calculated based on the difference between the total balance of the customers’ yen and/or multi-currency saving deposits and the outstanding loan balance.
By gradually increasing their savings account balance over the period of the mortgage, customers can significantly reduce their mortgage interest payments. Furthermore, if the size of a customers’ savings account is greater than the size of their outstanding mortgage repayment, they will essentially be charged no interest on their mortgage.
HSBC Smart Mortgage is primarily targeted at individuals looking to purchase a property for residential use for themselves and/or their family members, while HSBC Smart Investment Mortgage is designed principally for individuals who want to purchase a second home or are looking to buy a property to lease for rental income.
According to HSBC, both mortgages are also available to individuals looking to refinance their existing home mortgage or those seeking finance to build or renovate a property, purchase land to build a home, or purchase a new or existing property. HSBC’s mortgage products are available to foreign nationals residing in Japan, regardless of their permanent resident status.
Francois Moreau, managing director, head of personal financial services Japan, HSBC, said: Our HSBC Smart Mortgage and HSBC Smart Investment Mortgage are a part of a comprehensive range of services we will bring to customers on day one of our HSBC Premier service. With no cap on the size of the mortgage loan, together with the balance-offset mechanism, our new mortgage solutions will give customers greater flexibility to manage their mortgage repayments better.
