25yr or 30yr mortgage?

silverdog

Hi, Im a FTB and about to apply for my mortgage (house offer accepted).
I did assume I would apply for 25years, but as Im a sole applicant a 30yr mortgage may look more affordable on paper? (I could always then overpay).
Do you think I might have a better chance of getting it by going for 30 years please?
Any downside to applying for 30years -is this unusual?

Smiley1987

We went for 30yr to bring the monthly payments down. Its a 4 year fixed rate so i dont see why when you remortgage after the 4 years you couldn't bring the term down.

Or i imagine if you overpay (which pays off capital not interest from what i've been told) you'll have paid it off in less than 30 years anyway

vacheron

Agreed.

If you go for the 30 year term you will have a lower mandatory payment to make each month in times of trouble.

You can then always save the monthly difference between the 30 and 25 year term and use it to overpay the 30 year term which will effectively make it a 25 year term.

japmis

I changed my mortgage application from 25 to 35 years after a long discussion with a good friend who's a financial advisor.

Advantages for me (may not be the same for you)
1. More flexibility, I plan to over pay but don't have to
2. My mortgage payments now equal the rental value if I ever have to rent it out
3. If/when I am on maternity leave, the payments are more manageable.
4. I can repay up to £500/month without being penalised
5. OR (and this is what my friend stressed) I can put my savings elsewhere e.g. a tax free ISA so when I come to move next time, I have a larger deposit and potentially a better LTV. At the moment I just have a 10% deposit which hasn't yielded the best interest rates (4.2% fixed for 2 years from NW).

Remember your circumstances may differ from mine.

Hope this helps

Dave_the_Ginger_Cat

Agree with everything that's been said - all very sensible

The only thing I might add is to suggest putting the numbers through a mortgage repayment calculator to see how much difference it makes. When I took my first one it was barely any difference between 20 years and 25, so I opted for 20, but that was in the days when interest was over 10%, and capital barely featured!

Good luck with your search

silverdog

Thanks everyone