Are the fixed-rate plans offered by banks really the most interest-saving option? What will the interest rate be after the fixed-rate period ends? How long is the early repayment penalty period? What types of properties and mortgages are eligible? This article examines the features of banks’ fixed-rate mortgages and the latest mortgage offers available.
Fixed-Rate Mortgage Comparison 2026 | Benefits
- Save on interest expenses immediately while locking in the interest rate for a specified period.
- Suitable for people with non-fixed incomes and long-term investors such as rental-property investors, helping to stabilize the housing repayment budget.
- Owners who previously chose a developer’s high loan-to-value mortgage can save interest by refinancing into this plan.
- An extended application period gives the market more time to consider its options.
Fixed-Rate Mortgage Comparison 2026 | Advantages of Large Banks’ Fixed-Rate Plans
- Unaffected by interest-rate fluctuations: enjoy a fixed rate during the fixed-rate repayment period.
- Fixed monthly repayments make housing costs easier to budget.
Fixed-Rate Mortgage Comparison by Bank 2026
| HSBC (New Properties) | HSBC (Non-New Properties) | Hang Seng Bank (New and Second-Hand Private Residential Properties) |
Application period | 3 or 5 years | 3 or 5 years | 3 years |
Loan-to-value ratio | Up to 90% | Up to 90% | Up to 90% |
Interest rate | Stage 1: 2.73% | Stage 1: 2.73% (ended) | 2.93% during the fixed-rate period; thereafter P - 1.75% (effective rate: 3.25%) |
Mortgage type | New mortgage, refinancing, cash-out refinancing of an unencumbered property | New mortgage, refinancing, cash-out refinancing of an unencumbered property | New mortgage, refinancing, cash-out refinancing of an unencumbered property |
Application deadline | September 30, 2026 (Stage 1) | August 31, 2026 (Stage 1 — ended) | November 30, 2026 |
Drawdown deadline | On or before January 31, 2027 (Stage 1) | December 31, 2026 (Stage 1 — ended) | On or before April 30, 2027 |
Early repayment penalty period | 2 to 3 years | 2 to 3 years | 2 years |
Do Large Banks’ Latest 2.93% Plans Still Offer an Advantage over H Plans?
In response to funding costs and corporate strategy, HSBC has slightly raised the annual interest rate of its fixed-rate plan. Although the annual rate has increased by 20 basis points, it remains 32 basis points below the capped rate of typical new P-plan and H-plan mortgages. Assuming a loan amount of HK$5 million over 30 years, the prevailing capped rate for H plans is 3.25%, with monthly repayments of HK$21,760. Under HSBC’s latest 3-year and 5-year fixed-rate plans, the rate is fixed at 2.93%, reducing the monthly repayment by HK$868 (4%) to HK$20,892 compared with the prevailing H-plan cap.
HSBC Latest Fixed-Rate Mortgage vs. H Plan
| H Plan | HSBC Latest Fixed-Rate Mortgage |
Capped rate | 3.25% | — |
Fixed rate | — | 2.93% |
Monthly repayment | HK$21,760 | HK$20,892 (−HK$868) |
(Assuming a loan amount of HK$5 million over 30 years.)
Features of HSBC’s Fixed-Rate Mortgage Plan
- Application period: 3 or 5 years
- Loan-to-value ratio: up to 90%
- Interest rate: 2.73%–2.93% during the fixed-rate period
- Property types: new and second-hand private residential properties
- Mortgage types: new mortgage, refinancing, cash-out refinancing of an unencumbered property
- Application deadline: December 31, 2026
- Drawdown deadline: April 30, 2027
- Early repayment penalty period: 2 to 3 years
Hang Seng Bank Fixed-Rate Mortgage Plan
- Application period: 3 years
- Loan-to-value ratio: up to 90%
- Interest rate: 2.73% during the fixed-rate period; thereafter P - 1.75% (effective rate: 3.25%)
- Property types: new and second-hand private residential properties
- Mortgage types: new mortgage, refinancing, cash-out refinancing of an unencumbered property
- Application deadline: November 30, 2026
- Drawdown deadline: on or before April 30, 2026
- Early repayment penalty period: 2 years
Standard Chartered Bank Fixed-Rate Mortgage Plan (Ended)
- Application period: 3 years
- Loan-to-value ratio: up to 90%
- Interest rate: 2.73% during the fixed-rate period; thereafter P - 2% (effective rate: 3.25%)
- Property types: new and second-hand private residential properties
- Mortgage types: new mortgage, refinancing, cash-out refinancing of an unencumbered property
- Application deadline: August 31, 2026
- Drawdown deadline: on or before February 28, 2027
- Early repayment penalty period: 2 years
The banks’ current fixed-rate mortgage plans include cash rebates. Complete the enquiry form to receive a free introduction from a mortgage specialist.
Fixed-Rate Mortgage vs. H Plan: Which Is Better?
Many customers ask MReferral Mortgage which is preferable—fixed-rate or H-plan mortgages. The following table summarizes the features and benefits of the two mortgage plans.
| Fixed-Rate Mortgage | H Plan |
Selected bank | HSBC | Major banks |
Short-term rate | Locked in for 3 or 5 years at 2.73%–2.93% | If interbank rates remain high, repayments are generally based on the capped rate of 3.25% |
Long-term rate | After the fixed-rate period, calculated at P - 1.75% / P - 2% | Moves according to interbank rates and the cap |
Repayment stability | More stable during the fixed-rate period, remaining at 2.73%–2.93% | More variable |
Property choice | New and second-hand private residential properties | Various new and second-hand private properties, as well as subsidized housing such as HOS flats |
Mortgage-link available? | No | Generally yes |
Enquire About the Latest Fixed-Rate Mortgage Offers
How Much Can a Fixed-Rate Mortgage Save? Is It a Bet against the Bank? (Using the 2.73% Fixed-Rate Plan as an Example)
Assume a 3-year fixed-rate mortgage with a loan amount of HK$5 million over 30 years. The prevailing rates for typical H- and P-plan mortgages are 3.25%, with monthly repayments of HK$21,760. Under the fixed-rate plan offered by a large bank, the rate is fixed at 2.73%, reducing the monthly repayment by HK$1,401 (6.4%) to HK$20,359 compared with typical H- and P-plan mortgages.
Many people consider a fixed-rate mortgage to be a bet on future interest-rate movements. For example, if interbank rates remain high in the future and H-plan repayments stay at the capped level of 3.25%, those who choose the 2.73% fixed rate will enjoy lower rates in the short term—effectively “winning the bet against the bank.” However, if Hong Kong cuts interest rates faster than expected and interbank and prime rates fall sharply, dropping below not only the 3.25% cap but also the 2.73% fixed rate, the borrower will have “lost the bet against the bank.”
First 3 years | Fixed-Rate Mortgage | Typical H Plan |
Interest rate | 2.73% | 3.25% |
Monthly repayment | HK$20,359 | HK$21,760 |
Savings | HK$1,401 (6.4%) |
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How Should You Choose between a Fixed-Rate and H-Plan Mortgage? A Four-Step Decision Guide (Using the 2.73% Fixed-Rate Plan as an Example)
Step 1: Assess Expected Future Interest-Rate Movements
First, you need to form a view on future market interest rates, particularly the direction of the Hong Kong Interbank Offered Rate (HIBOR). This will directly affect the actual repayments under an H plan.
1. Understand the current rate differential:
- The fixed rate for 3-year fixed-rate mortgages currently available in the market is approximately 2.73%.
- The cap for typical H plans is currently approximately 3.25%.
- Based on a loan amount of HK$5 million over 30 years, the monthly H-plan repayment at the cap is approximately HK$21,760, while the monthly repayment for a fixed-rate mortgage during the fixed-rate period is approximately HK$20,359—a monthly saving of HK$1,401.
2. Form an expectation for HIBOR:
- If HIBOR is expected to remain high (close to the H-plan cap of 3.25%), a fixed-rate mortgage may be more cost-effective because it locks in a lower rate and avoids higher H-plan repayments caused by rising HIBOR.
- If HIBOR is expected to continue falling to a low level over the next one to two years (below the fixed rate of 2.73%), consider an H plan. In that situation, actual H-plan interest costs may be lower than those of a fixed-rate mortgage, thereby saving interest expenses.
Step 2: Confirm the Property Type and Eligibility
Different mortgage products impose different restrictions on eligible property types and application timing. You should confirm that your property meets the relevant requirements.
1. Check the property type:
- Fixed-rate mortgages currently available in the market mainly cover new and second-hand private properties.
- Mortgage applications for subsidized housing (such as HOS flats), parking spaces, and commercial or industrial properties are not accepted. If you plan to purchase these types of properties, you can only choose an H plan or a P plan (prime-rate mortgage).
2. Note the application and drawdown deadlines:
- Fixed-rate mortgages generally have specific application and loan-drawdown deadlines. If you intend to apply, make sure to act within the relevant timeframe.
- H plans generally have no special application or drawdown time restrictions and offer greater flexibility.
Step 3: Consider Your Investment Objectives and Financial Situation
Your property-investment strategy and personal financial situation are essential considerations when choosing a mortgage plan.
1. Assess your investment objective:
- For short-term investment: a fixed-rate mortgage locks in the short-term monthly repayment, making investment returns easier to calculate than under an H plan and helping with budget management.
2. Consider the impact of the penalty period:
- The penalty period for a 3-year fixed-rate mortgage is generally as short as 2 years, similar to that of an H plan.
- The penalty period for a 5-year fixed-rate mortgage is 3 years. If you expect to sell the unit during the penalty period, you will need to pay an early repayment penalty, increasing your transaction costs.
3. Review idle funds and Mortgage-link plans:
- If you hold substantial idle funds, H plans generally offer an interest-offset arrangement (Mortgage-link). This links your deposits to the mortgage loan so that deposit interest offsets part of the mortgage interest expense, reducing the actual repayment cost. You should assess whether such an arrangement is more advantageous than a fixed-rate mortgage.
Step 4: Seek Professional Advice
Because everyone’s financial situation and investment objectives are different, you are advised to consult a professional mortgage-referral company or financial adviser before making a final decision. They can provide more precise analysis and professional recommendations based on your specific circumstances, helping you choose the mortgage plan that best suits your needs.
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