c2-financial has launched a product based on the Swiss LIBOR rate, currently 1.45%, rather than the UK LIBOR rate which currently stands at over 4.5%.
The product, which is funded by SALT, is available exclusively through c2-financial and a small select group of other packagers from July 31 2006.
Although the interest rate is based on the Swiss LIBOR rate, the mortgage is sterling based and therefore the customer has no currency risk to worry about.
c2-financial says its initial indications show that the customer will see more attractive headline rates than are currently available on comparable terms elsewhere.
The product is currently only available on a five-year tracker and carries ERCs during the first five years.
After the first three years however, the customer will receive a cashback of 2% of the mortgage balance, subject to having maintained their mortgage payments in full and on time during the first three years.
Interest rates start at just 4.79% on prime deals, heavy adverse deals up to 85% are available at just 6.04% and fastrack unlimited deals are available at 6.64% up to 80% LTV.
David Wylie, chairman of the c2 Group, says: SALT is demonstrating real and tangible product innovation by launching such a spectacular new concept.
The interest rates are astonishing, and whilst we appreciate that a five year tie-in will not be suitable for everyone, the 2% cashback after three years is a real incentive for customers to pay close attention to maintaining their finances in good order.
He adds: I have instructed our intermediary sales department to include these products within the relevant categories of C75 and C55 and this means, that by accessing the products via c2, customers will benefit from free valuations, low application fees and in the case of C75, a 0.75% cashback.
Brokers will also be safe in the knowledge that they will be receiving market leading proc fees.