High Street bank HSBC has launched a new combined, split loan mortgage that gives customers the chance to fix a proportion of their mortgage, while the rest of the loan stays variable, tracking the Bank of England base rate during the course of the loan.

 

This combined mortgage product is intended for customers who want to track the base rate and keep their flexibility over overpayments, as well having the security of fixing on the historically low fixed mortgage rates .

 

Customers can choose to fix 25 per cent, 50 per cent or 75 per cent of their loan, while the rest is placed on a lifetime tracker at the same rate as the fixed proportion. The interest rate will depend on the proportion of the mortgage that is fixed, as well as the loan-to-value (LTV) of the mortgage. The mortgage carries a booking fee of GBP999 to cover both loans, and is available for those borrowing up to GBP500,000.

 

The majority of your borrowing can be fixed, and you can overpay without limitation on the variable rate element of the mortgage. Borrowers also have the option to pay their booking fee now and then delay in drawing down the mortgage for up to six months.

 

No one can be sure when interest rates will start to rise again, increasing doubt about the best type of mortgage to take out to fix or not to fix. This compromise solution adds to the options available.