Perenna has been granted a banking licence by regulators to offer mortgages with fixed rates of up to 50 years.
The specialist lender is initially planning to provide fixed terms of up to 30 years, with plans to roll out longer-term products in the future.
The Government has been floating the idea of 50-year mortgages of late and the Bank of England has also given plans its seal of approval.
Arjan Verbeek, chief executive and founder of Perenna, said: “Rates are going up and if you have a household budget to manage, you need to know what you’re paying on your mortgage every month.
“With inflation running high, this will take a chunk of the stress out.
“Mortgages are broken in the UK because normal people can’t buy a house.
“This is not the case in other markets, such as the US and Denmark, where stability is being provided by long-term mortgages.”
Perenna will issue covered bonds to pension funds and insurers for longer-term financing which could see the lender offer rates of 4% to 4.5% on 30 to 50-year mortgages, although this would be affected by gilt yields at the time.
The lender is aiming to launch its first products within six months.
