First-time buyers turn to longer loans as prices surge

More property buyers have taken on longer loans to make rising house prices more affordable - but risk spending more in interest. The number of mortgages sold with 35-year term or longer hit a three-year high in March this year, according to a Freedom of Information request from wealth manager Quilter. The level jumped by almost 75% compared with the same month in 2020. It came as house prices rose at their fastest rate since 2007. The frenzied market and huge price increases meant borrowers were forced to agree to longer mortgage deals to afford home purchases, said Quilter. It noted that compared with a 25-year term, for a 30-year term, the total bill will be £16,500 higher because more interest is incurred. 

The Daily Telegraph (13/08/2021)