Hinckley & Rugby Building Society has announced that it will now offer split mortgages.

The lender says that the deals are tailored for first-time buyers who are being helped financially by their parents.

Split terms are available across all of the building society’s residential mortgage products, including those which may appeal to later life borrowers.

The firm adds that a split into part repayment, part interest-only could suit borrowers who intend on retiring when the repayment term ends and then paying the interest-only split from pension income.

The building society has also reduced rates on the 75 per cent LTV five-year fix from 3.99 per cent to 3.49 per cent, and on the 95 per cent LTV two-year fix from 3.49 per cent to 3.29 per cent.

The former deal is within the later life range, has a £199 application fee, a £800 completion fee and tiered ERCs from 5 per cent to 1 per cent.

The latter offering is within the joint borrower sole proprietor range and includes tiered ERCs from 2 per cent to 1 per cent.

Hinckley & Rugby head of sales and marketing Carolyn Thornley-Yates says: “We wanted to add the ability to split so we can help first time buyers where the parent’s working income is needed for affordability.

“Almost all parents will plan to retire, usually before a child’s mortgage term would end. Splitting the terms recognises this reality whilst still enabling families to do what they can to help their next generations into home ownership.

“Splits can also work for later-life and mid-life borrowers who foresee wanting the make capital repayments whilst working and then service the remaining balance using pension income to pay on an interest-only basis.

“As a mutual, we are committed to supporting all of our members throughout their financial lives. For our borrowers that means we work hard to be there for them which they buy for the first time, the next time and all subsequent times.”