Should I get a 35-year mortgage?

Are you thinking about buying a home? You might wonder how long you should take to pay it off.

Let's talk about 35-year mortgages and if they're right for you.

More people choose longer mortgages now

The Bank of England published a report stating that almost half of new mortgages taken out at the end of 2023 were for a term of 30 years or longer.

When you stretch your mortgage over more years, you pay less money each month. This sounds great at first. But remember - you'll end up paying more money in total because of interest.

What is the longest mortgage term?

Different providers offer different mortgage lengths. In the UK, you can usually get a mortgage that lasts anywhere between 5 to 40 years.

What is a normal mortgage length?

In the past, most people chose 25-year mortgages with only one in three opting for longer in 2006. Now, 30 and 35-year mortgages are much more popular.

Am I too old for a mortgage?

There's no strict age limit for getting a mortgage, but most banks prefer that you apply before you turn 65.

Your age matters when deciding how long your mortgage should be. Most banks want you to finish paying your mortgage by the time you're between 70 and 85 years old.

If you're older, you'll probably need to pick a shorter mortgage. This means higher monthly payments, but you'll pay less interest overall.

Before you apply, make sure you can afford the payments now and in the future. Think about how your income might change, especially if you plan to retire soon.

Can a 40-year-old get a 35-year mortgage?

Yes! You can get a 35-year mortgage at age 40 if you can show you'll be able to make all the payments. But you might find it easier to get approved if you choose a shorter mortgage that you'll finish before you retire.

Whether you get approved depends on the bank's rules and your own situation.

Is a 35-year mortgage a good idea?

There are both pros and cons to consider for 35-year mortgages. Think carefully about your options. Remember, if you miss payments, your home could be at risk.

Pros	Cons
Lower monthly payments - You pay less each month because you spread the payments over more years.	Takes longer to own your home fully -You might need to work longer than you planned or show the bank you can make payments after you retire.
Easier to buy a home sooner - This helps if you can't afford the higher monthly payments of a shorter mortgage.	Costs more money in the end - You'll pay more interest overall compared to a shorter mortgage.

 

Example: For a £200,000 house with a 4.5% interest rate:

• 25-year mortgage: about £1,110 per month, total interest paid = £133,000
• 35-year mortgage: about £960 per month, total interest paid = £200,000

The 35-year mortgage saves you £150 each month, but would cost an extra £67,000 in interest.

💡 Tip: Talk to a mortgage adviser who can give you advice based on your own money situation.

What else do banks look at?

Each bank has different rules about who can get a mortgage. But most look at:

1. Your credit history - Banks check how well you've handled money in the past.
2. What you can afford - You need to prove you earn enough money and don't spend too much to afford mortgage payments, both now and in the future.
3. How stable you are - Banks like to see that you've had the same job and address for a while. Being on the electoral roll also helps show you're reliable.
4. How much credit you use - Try to use less than 25% of your credit limits to look better to banks.
5. Your debt compared to income - The less debt you have compared to what you earn, the better.
6. How many applications you've made - Applying for lots of loans or credit cards in a short time can make banks worry that you’re too reliant on credit.
7. Your deposit - The more money you can put down upfront, the less risk there is to the bank.
8. The property value - Banks prefer when your mortgage is much smaller than what the property is worth (lower loan-to-value). This is because in the event you defaulted on payments and the bank had to sell the property, they would be more likely to make back their investment.

A 35-year mortgage might be right for you if you need lower monthly payments. Remember to think about the extra interest you'll pay over time. Talk to a money expert before you decide. Your dream home is waiting - just make sure your mortgage plan fits your life goals!

Read on to learn about what paperwork you'll need when applying for a mortgage.