Should I extend my remortgage term?

October 12, 2020
Information published was correct at the time of writing

Before we discuss term length, what exactly is a remortgage?

Remortgaging – either the transfer of a mortgage from one lender to another or changing your mortgage with your existing lender – is an excellent way of borrowing money against the value of your property. It’s also a good way of getting a more favourable rate of interest with a new lender. (Read more on remortaging here –

I’ve got 15 years left on my 25-year mortgage – is it worth extending that period when I remortgage?

There are certainly some advantages. If you extend your remaining term from 15 to 25 years, then your monthly payments will be less if you’re not borrowing any more money, leaving you with more to spend every month. There’s definitely a trend of longer mortgages at present. According to the Government’s English Housing Survey, the proportion of homebuyers taking out mortgages with a term of 30 years or more has increased by nearly 50% over the last decade.

Great. Let’s get going!

Hold on. While your monthly payments might be smaller, you’ll be paying over a longer time (35 years if we use our example above), meaning you’ll pay more interest and what could be a significantly bigger amount in the long run. If you’re middle-aged or older, you could well be paying your mortgage into retirement, so may need to make provisions for that.

Ah, so I should keep the same term and clear it?

It’s about weighing up your options. There’s something reassuring about paying off your mortgage before retirement, but that may mean sacrificing other things to keep up with the payments in the meantime. The good thing about extending your mortgage is that you’ll notice the difference immediately because your monthly payments will be less, leaving you with more to spend on the things that matter to you. When you speak with us here at Charles Cameron & Associates, we will talk you through the different monthly repayment options that are available to you and recommend the most suitable product for your needs.

Does this work if I’m borrowing more money?

Yes, even if you’re increasing the size of your mortgage, extending the term could keep repayments lower. Though you’ll pay more in the long run.

Is there anything else I should think about?

The older you get, the less likely lenders will give you a long-term deal. At Charles Cameron & Associates, however, we will find the right mortgage with the right terms for older clients looking to extend their mortgage periods. With some banks increasing the maximum mortgage completion age to 80, we can offer more options than ever before. When you speak with us, we’ll take you through the pros and cons so you can make an informed decision. At Charles Cameron & Associates, we also have Equity Release qualified advisors, so if a standard mortgage isn’t appropriate for you, and you are over 55, one of our advisors can help provide alternative options such as a life time mortgage.

If you’d like to talk to us about extending your remortgage terms, just get in touch here.

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