"Our product offers improved affordability, certainty of monthly payments, and flexibility through low ERCs."
New mortgage lender, Perenna, has secured its unrestricted banking licence from the PRA and FCA, allowing it to launch its long-term fixed rate mortgage products to the UK.
Perenna’s flagship product will enable customers to have certainty in their mortgage rate for 20 or 30 years whilst benefitting from the flexibility of an early repayment charge period of just five years.
Long-term fixed rate mortgages are popular in the US, Denmark and other European countries. However, due to rising mortgage rates in the UK, more than a million households are facing an increase of over £500 to their monthly mortgage costs by the end of 2026.
HM Treasury, the Bank of England, think tanks and wider industry members, including Perenna, participated in a roundtable over the Summer, chaired by Anthony Browne MP, and discussed the role long-term fixed rate mortgages can play in improving the UK’s growth prospects.
Perenna’s proposition is created by a funding model which relies on issuing covered bonds to investors seeking long-term stable income, such as pension funds and insurance companies. It will enable the business to develop a range of products for first-time buyers, second steppers and later life homeowners.
Initially, Perenna will offer its mortgages to people on its waitlist, and then the wider public later this year.
Arjan Verbeek, CEO and co-founder of Perenna, commented: “We’re introducing much needed structural change to the UK. In other countries, billions of pounds of pension savings are channelled into the real economy using covered bonds. Together, our unique funding model and banking licence will enable us to do exactly the same in the UK and unlock the housing market, an important part of GDP.”
Colin Bell, COO and co-founder, added: “Our mission is to create a nation of happy homeowners. We’re excited to offer our flexible products to consumers who, for too long, have been left underserved. Our product offers improved affordability, certainty of monthly payments, and flexibility through low ERCs. We want people to get on with their life and not worry about their mortgage product.”
