Number of borrowers over 36 taking out 35-year mortgages surges 251%

Increasing numbers of people are taking out mortgages they could be paying off well into their 70s, new Freedom of Information data has revealed.

There has been a sharp uptick in people taking out mortgages lasting for 35 years or more, according to the Financial Conduct Authority data, analysed by wealth manager Quilter.

It revealed the number of people over 36 taking out 35-year mortgages has surged by 251 per cent in just five years.

The mortgage term is the number of years someone agrees to repay their mortgage for - which used to commonly be 25 years but on new mortgages is now more often 30 years or more.

By lengthening the term of a mortgage, a borrower spreads their repayments over a longer period of time and therefore reduces the monthly costs.

However, while taking out a longer mortgage term will reduce the monthly costs, it will ultimately mean paying interest for a longer period of time and therefore paying more in the long run.

The FOI data from the FCA showed that in 2024, 30,338 mortgages with a term of 35 years or more were taken out by those aged over 36.

That's up from 21,289 in the previous year, 16,170 in 2022, 11,092 in 2021 and just 5,911 in 2020.

While 2020 was disrupted by the outbreak of the pandemic, during which the property market effectively shut down for a few months, it still represents a 251 per cent increase on the 8,639 of those aged 36 or more who were sold mortgages of 35 years or more in 2019.

Over the past five years, there has also been a 56 per cent increase in the number of borrowers aged 31-35 taking out these lengthy loans.

This shift likely reflects the fact that people are finding it increasingly hard to afford to buy property.

High property prices and elevated interest rates have made monthly repayments more difficult to manage, prompting many borrowers to extend their mortgage terms.

For lenders, longer terms can also help more people meet affordability criteria, especially as wages have not kept pace with the cost of living.

The trend toward longer mortgage terms among older borrowers suggests deeper structural issues, according to Zara Bray, mortgage expert at Quilter.

These include delayed homeownership, limited housing supply, and the growing gap between income and housing costs.

While longer terms may ease short-term financial pressure, they also underscore the need for broader reforms to improve housing affordability.

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'The jump in older borrowers opting for ultra-long mortgage terms highlights just how stretched affordability has become but doesn’t necessarily need to be viewed negatively,' said Bray.

'Given the majority of mortgages are supported by a mortgage adviser, this is a positive example of advice enabling customers to remain in their homes during difficult macroeconomic conditions.

'Extending your mortgage past retirement age may be a sensible lever to pull in the short term, allowing other assets to remain invested.

'Remortgaging to a better deal when interest rates fall or your loan-to-value improves can lower monthly repayments or allow you to switch to a shorter term.

'For those approaching retirement, it’s worth exploring whether downsizing or using pension drawdown strategies could help manage repayments more sustainably

'There are other steps people can take to reduce the long-term burden. Overpaying on your mortgage, even by small amounts, can significantly reduce the total interest paid and shorten the term.'