A Combination Home Loan is also known as a ‘Split’ Home Loan. Many lenders will allow you the option of splitting a loan into a partly fixed rate and a partly variable rate components, at whatever percentage the borrower chooses.

For example, an 80% fixed rate with a 20% variable rate. This allows the borrower to customise the loan so as to combine the security of the fixed loan with some of the flexibility of the variable loan.

It is especially useful where the borrower is uncertain about the future direction of interest rates, they can ‘lock-in’ repayments on part of the loan by selecting a fixed rate and enjoy the potential for lower rates by keeping part of the loan on a variable rate
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