Newcastle Building Society has launched a mix-and-match mortgage which it says offers the security of a fixed rate and the flexibility of a variable offset mortgage combined.
Borrowers can have part of their mortgage on a variable rate and use their savings to offset the interest they pay.
Newcastle's offset mortgage has an initial standard variable rate minus 2.2 per cent for the first six months, reverting to SVR minus 1.5 per cent for the rest of the term.
At the same time, borrowers can choose to have a separate part of the mortgage on a five-year fix at 5.4 per cent, offering security against any future interest rate rises.
Chief executive Robert Hollinshead says: “We believe this is a unique product that combines highly competitive rates of two completely different mortgages. It is a flexible approach to changing market conditions. We have found that while people are keen to avoid rate rises, they can also be reluctant to commit themselves entirely to a fixed rate for the long term.”