Good question! This one doesn’t have a specific answer and it’s something we as brokers can advise on.
The typical default term that most people have in their minds is 25 years. However, this can be increased or decreased depending on monthly cost and affordability.
The most important factor to consider is having a monthly payment that’s easily affordable and allows for a healthy cash flow. Especially for first time buyers as you find that a few unexpected costs could pop up during your first year as a homeowner. Furniture purchases, water bills, maintenance or repair costs – something like the guttering could break or the heating stops working!
Don’t forget, you don’t have to keep the mortgage for the full term – you can reduce it in the future if you prefer. Even in between remortgaging you can change the overall term of the mortgage in line with your circumstances at the time.
A lot of mortgages allow you to overpay by a certain amount each year so if you’re in two minds about taking a slightly longer term but feel it’s not the ‘right thing to do’, there could be the option to start overpaying.
This way you’re not making a commitment to the lender and you won’t be stuck with the higher monthly payment but when you’re ready to do so, you can increase your monthly payment and in turn, repay the mortgage as though you had taken a short term.
This is definitely one to talk through with your broker if you’re in two minds about the term.
