How to choose your mortgage term

June 9, 2017 by Brendan O'Neill

Advice & Tips

In the past, a typical mortgage term for house buyers used to be 25 years. However, there are now more options to apply for a shorter term mortgage, or even one which lasts for 30 years or more.

Choosing the most suitable term for you can be a complex process and it’s often easier to seek the support of a mortgage advisor, who has spent time on a CeMAP training course, to help secure the best deal for your circumstances.

There are pros and cons to short and long term mortgages. For a shorter term, such as 15 years, you will pay less overall and pay off your mortgage quicker, but will pay more every month which may not be ideal if you are budgeting. Consider the future when you choose your payment term, especially if you have a specific retirement age in mind and want to be mortgage free.

Your age when applying for a mortgage may also be a relevant consideration, as the older you are, the shorter the mortgage term available to you will be. Although some lenders will consider lending to people of retirement age with a suitable income.

If you decide to opt for a short term product, there are no guarantees that you will be accepted, as lenders consider affordability. An alternative option is to opt for a long term mortgage and make regular overpayments. Each lender has different criteria, so make sure that you mention this to the mortgage advisor. Making overpayments will reduce the mortgage term and the interest which is payable.