The number of people taking out mortgages with terms of 35 years or more has doubled and hit a high of 88,059 in 2022.

According to a new freedom of information (FOI) request to the Financial Conduct Authority gathered by wealth manager, Quilter, the figure for last year compares to just 40,471 people in 2018, marking a 117% increase.

Borrowers have faced a flurry of successive interest rate increases since December 2021, with the Bank of England raising its base rate from 0.1% to 5% in that time, as well as historically high house prices across the UK, forcing people to take out longer terms to achieve lower monthly payments.

Quilter highlighted that there are now also nearly four times as many people taking out mortgages with terms that they will be still paying off when they reach their seventies. In 2022, there were over 12,000 people over the age of 41 who took out a 30 to 35-year term. By comparison, in 2018, just 3,035 people over the age of 41 took out a 30 to 35-year term.

The average fixed rate two-year 95% LTV deal is currently hovering around 6.50% making it likely that even more people, regardless of age, will be forced into taking out longer mortgage terms.

“For many people, to realise the dream of homeownership or to simply obtain an affordable mortgage they have had to increase the term of their mortgage,” said mortgage expert at Quilter, Karen Noye.

“While this is not inherently wrong and can be a lifeline for people during this difficult time, it does have the potential to stretch people’s finances later in life particularly for those in their forties.

“For anyone considering entering into a mortgage that will see them well into retirement, it is vital they think ahead and are aware of the potential risks.”

She added: “While a mortgage term of 35 years or more can result in lower monthly repayments, you are likely to pay considerably more in interest over the course of your mortgage term.

“While there are several risks to consider, a longer mortgage term does not always spell bad news. Certain types of mortgage products allow you to make overpayments which could help to make repayments past retirement age more manageable. Overpaying can also help to reduce the amount of interest paid by decreasing the overall term length.”

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