Split Loan

A split loan is a loan that switches from one type to another, allowing the borrower to enjoy the benefits of both schemes. It is usually designed to reduce initial interest rates and help you prepare for the rest of the payments. A common split loan is the fixed-to-variable scheme, wherein you start off with a low fixed rate for the first few years before switching to the variable rate. It is also possible to switch between two loans of the same type, or to switch back more than once.