HSBC plans to offer home-buyers a new, fixed-rate mortgage to remove the uncertainty associated with floating rates. It would give customers an opportunity to lock into the present low rates of interest. Yesterday, head of mortgages for HSBC Lawrence Law said historical evidence suggested interest rates were at, or near, the bottom of their cycle. The fixed-rate product - to be launched on a pilot basis this month - would lock mortgage rates in for a maximum of three years. Barring any dramatic change to present interest-rate settings, it would be fixed at between 1.5 per cent and 1.75 per cent above prevailing floating-rate mortgages. 'You can count nine major interest-rate cycles over the past 30 years - excluding the present cycle which has not yet been completed,' Mr Law said. 'Simple arithmetic tells me that every three years we have a major cycle, though some are shorter and some are longer.' And swings in rates could be quite severe. While the average spread between the lowest and highest rates in the cycle during the past 30 years worked out to 6 per cent, the widest spread - in the 1977-80 cycle - was 11.5 per cent. 'If we use history as our guide and do a projection, we expect that, if this is the lowest point, rates will begin to go up again,' he said. However, Mr Law indicated HSBC would not offer the fixed-rate mortgage as a substitute for its floating-rate portfolio. It would constitute only a small percentage of its home lending. He would not reveal the amount set aside to support the product, but said it was being offered to ensure that HSBC provided a full range of products, including one that catered for customers wanting the comfort of certainty, rather than floating rates.