New Freedom of Information (FOI) knowledge from the Financial Conduct Authority (FCA), analysed by Quilter, reveals an enormous rise in the variety of individuals aged over 36 taking out mortgages with a time period of 35 years or extra.
In 2024, 30,338 mortgages with a time period of 35 years or extra had been offered to individuals aged over 36.
Over a five-year interval since 2019 there was a 251% enhance in the variety of older debtors taking out longer mortgage phrases. And there has additionally been a 56% enhance in the variety of debtors aged 31-35 taking out these prolonged loans.
As Quilter factors out this shift displays broader affordability challenges in the UK housing market. High property costs and elevated rates of interest have made month-to-month repayments harder to handle, prompting many debtors to increase their mortgage phrases.
For lenders, longer phrases may also assist extra candidates meet affordability standards, particularly as wages haven’t stored tempo with the price of dwelling.
The pattern towards longer mortgage phrases amongst older debtors highlights deeper structural points. These embrace delayed homeownership, restricted housing provide, and the rising hole between earnings and housing prices.
While longer phrases could ease short-term monetary stress, in addition they underscore the necessity for broader reforms to enhance housing affordability.
Quilter mortgage skilled Zara Bray commented:
“The leap in older debtors choosing ultra-long mortgage phrases highlights simply how stretched affordability has change into however doesn’t essentially should be considered negatively. Given nearly all of mortgages are supported by a mortgage adviser, this can be a optimistic instance of recommendation enabling prospects to stay in their properties throughout tough macroeconomic circumstances.
“Extending your mortgage previous retirement age could also be a smart lever to tug in the quick time period, permitting different property to stay invested.”
