This is a tailored package which allows you to keep a fixed rate for 3, 5 or 10 years. At the end of each period, it is you who decides whether to continue with a fixed or variable rate until the end of the next period, and so on. Let’s take the example of a 20-year contract with a review period of five years. At the end of the first five-year period, you kept a fixed rate for the second period. For the third period, you chose to change to a variable rate. For the fourth period, you go back to a fixed rate.
The protection offered to you by a fixed rate during the first period(s) of your contract is substantial. The interest due is actually higher at the start of the contract than at the end.