demand-for-longer-term-mortgages-doubles

 

Demand for longer term mortgages

Recent data released by the Council Of Mortgage Lenders show that there has been an increase in the number of buyers taking out longer term mortgages. Traditionally the term a loan was taken out for was 25 years but there appears to be a shift to upwards of 25 years as buyers opt for longr the longer period for affordability reasons. Because house prices have risen so much and it is no longer possible to get an interest only mortgage buyers are lookig at other ways of taking out a mortgage.

The shift to the new longet term loan periods has douubled in 2014 and will possibly be considered the norm in a few years as buyers try to keep up with rising prices. Put simply some of these buyers would not be able to afford the monthly payments for a 25 year loan so they are opting for 30 and 35 year mortgages.

Of course this pushes up the amount you pay over the longer term but buyers seem more interested in getting a foot on the ladder in the first place. Without 35 year mortgages these people would not be able to buy a home. Most of the loans are being taken out by borrowers aged under 30.