25 year or 30 year mortgage does it make a big difference

jamminjamaica

hi folks

i cannot decide there is only £50 permonth difference in the monthly repayments.

can anyone tell me if it would make a huge differnce if we took a 25 or 30 year mortgage.

tomstickland

Do the basic sum of
25 x 12 x 25year payments
compared to
30 x 12 x 30year payments

You will pay back more with the 30 year term.

JennyB

Have a look at the total amount repayable on each mortgage offer - I think you'd pay a lot more in interest on the 30 year one. I personally opted for the shortest term possible - if you can afford it then it's cheaper in the long run.

missk_ensington

I opted for 30 year as I need the extra money now, and I don't anticipate I'll nee the money so much in 10+ years time.

Chances are, you'll remortgage at some point anyway and can change it bacj to 25 years, or if you're planning to make any money out of property and pay off your mortgage quickly it possibly wouldn't make any difference.

Its only going to be detrimental if you only make the neccessary payments, and don't overpay for 30 years.

jyonda

Most mortgages will allow over payments so keep your monthly to a minimum then overpay when you have some extra cash. Only works if you're disciplined with money though.

markintheroost

Consider:
paying 50*12*25 = £15,000 more for the first 25 years. Then the last 5 years with say a £700 mortgage: 700*12*5 = £42,000.

So that's an extra £57,000 you'll be paying which seems loads but may not be that much in 30 years time! I would definitely pay as much as you can.