Banking giant HSBC has launched a mortgage with a record low rate of below 3%.
The Premier two-year discount deal is priced at 0.95% below the group's standard variable rate (SVR), meaning borrowers will pay 2.99% when the latest interest rate cut comes into effect on February 6.
The group said it was the lowest mortgage rate it had ever offered, and it is also the first rate offered to new borrowers to dip below 3% since interest rates began to fall.
Financial information group Moneyfacts also believes it is the first ever mainstream mortgage which does not include an initial discount to have a starting rate of below 3%.
But the deal will only be available to people who have a 40% deposit and qualify to be an HSBC Premier customer.
In order to qualify for a Premier account, people need to either have at least £50,000 in savings and investments held with HSBC, or they have to have a £250,000 mortgage with the group and a salary of £75,000.
However, people do not have to have their salary paid into their Premier account, and the group may waive the requirement for new customers to open one of the accounts as long as they meet the criteria.
HSBC has pledged to double its mortgage lending from its 2007 level this year, and it aims to advance £15 billion to homeowners.
The group also re-entered the market for people wanting to borrow 75% of their home's value, with the launch of a lifetime tracker mortgage at 4.09%.
Martijn van der Heijden, head of mortgages at HSBC, said: "As the Bank of England base rate comes down, we have the ability to increase even further the affordability of our mortgages, many of which were already the cheapest to be found on the high street."
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