'One third of lenders offer mortgages beyond 40 years'

09-Nov-2006

Around 33 per cent of lenders offer mortgage terms for 40 years or beyond, potentially helping first time buyers gain a foothold on the property ladder.

According to research by MoneyExpert, first time buyers and repeat purchasers can arrange loans in excess of 25 years, with lenders frequently offering terms of between 40 and 52 years.

HSBC and Alliance & Leicester offer loan terms of 40 years, while First Direct and Tesco offer loan terms of 47 and 52 years respectively.

"The cost of the average home has doubled in the past five years, making it more and more difficult for potential homeowners to buy a house," said Sean Gardner, chief executive of MoneyExpert.

"The old model of three times salary and a mortgage lasting 25 years maximum is on the way out," he added.

However, most mortgage lenders remain committed to requiring all borrowers to paying off their loan by the time of retirement, although some providers will allow term limits to extend until a borrower reaches 75.

MoneyExpert offers comparisons on a number of financial products, including credit cards and personal loans.

For advice on first time buyer mortgages or to find out how much you can borrow and how much it would cost you, contact a good mortgage broker.

First time buyers concerned about how an increase in interest rates might effect how much they would have to pay each month should consult a good broker.

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