Financial Times - The rise of the 40-year mortgage
More than half of all mortgage products can now be taken out for a 40-year term, up from 36 per cent just five years according to research from Moneyfacts.co.uk. The finance website says that 51 per cent of all residential mortgage products have a standard maximum term of up to 40 years. Historically, the norm for home loans has been 25 years.
Aaron Strutt, product director at Trinity Financial, told The Financial Times, that if a customer took out a longer term deal and then found themselves in a better financial position when they came to remortgage, “it is worth reducing the term so the debt is repaid much earlier. Many of the lenders allow overpayments so you can also pay more each month to reduce the interest costs.”
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