Mortgage with HSBC or BOC?

Hi everyone,



I've just received the same mortgage offer from HSBC and BOC - both were P-2.95%, with P being 5%. I believe it's a very good offer from all the advices I've gathered in this forum and so I've made up my mind to take this offer instead of the HIBOR option. What I'm troubled with now is whether to go with HSBC or BOC. Has anyone have any experiences or problems with either of the banks? I've read in this forum that it's better to take up a mortgage with an institution that has a higher P but offer the same effective interest rate (i.e. with SCB at P-3.2% with P being 5.25%); however, in my case, both HSBC and BOC has a P of 5%. What I was hoping to get everyone's thoughts on, is which bank is likely to be the quicker one to increase its P in the future? I've read elsewhere in this forum that HSBC is more likely to keep a lower P as their deposit base in Hong Kong is far larger than anybody else, and so there is a huge drop off to BOC. What does everyone think about this? Any advices are welcomed!


I would also appreciate if anyone could let me know whether there is anything I need to be aware of, other than reading the fine prints carefully, before I sign my life away~


Many thanks.

James, if he is on a short term buy and sell, Hibor could make sense.


Apart from that, most deposit linked instruments have a cap that makes the promised savings limited. Even then one needs to have the deposits first, so the p- could make sense in my view

They both offered a 1% rebate. The only difference is the penalty - BOC's penalty is higher but both are only for a period of two years and we don't foresee ourselves selling the apartment within two-year's time so it isn't a main factor for us.


James: apologies for a silly question but what kind of bank fees/charges would I incurr with a mortgage? I have accounts with both banks so they would just deduct a monthly amount from my bank account? Or were you referring to my day to day banking?


We've used all our cash on the apartment so you can consider our deposit to be nil at the moment - is a deposit-linked mortgage still beneficial in the long-run?


Thank you both for the reply!

You really need to do the math to see how you need a large lump of cash to make it worthwhile. Even with cash I chose to go for the HIBOR @ BOC because it would have made it more complicated to invest it elsewhere. I would not take James' advice anyway as a prime-minus loan at close to -3% is quite good. The best I was offered at the time I took HIBOR was only P-2.5-ish. Now I am strongly considering making the switch.

I don't understand why a HIBOR loan is not good even for the long term. If I am currently signing up for a loan and am offered P-3.2% or HIBOR with a cap at P-2.5%, and my effective rate with HIBOR is say 1.1%, why wouldn't I take the HIBOR rate? Okay so in the future I might end up paying 0.7% more if I hit my cap, but isn't it a good risk/return trade off?

sxc, as i have written above, we are currently living in a very seldom situation where hibor+ loans are cheaper than p-. over a 15+ year timeframe you might on average get 1-2 years of where hibor+ is cheaper than p-.


so yeah you can bet on it, but i think the odds are against you in the long run