Mortgage Term 20yrs-25yrs-30yrs

thebackbar

Hello,

I'm currently in the process of getting a mortgage, I've been advised that getting a 30 yr mortgage on a variable rate offers the most amount of flexibility, i.e i can pay it off at the same rate as i would if i got a 20yr, ie make the repayments each month based on a 20yr schedule, then if things got a bit tight i can reduce the amount i pay to the standard rate for the 30yr term ?

Any down sides to this approach

thanks

Heisenberg1

thebackbar wrote: »

Hello,

I'm currently in the process of getting a mortgage, I've been advised that getting a 30 yr mortgage on a variable rate offers the most amount of flexibility, i.e i can pay it off at the same rate as i would if i got a 20yr, ie make the repayments each month based on a 20yr schedule, then if things got a bit tight i can reduce the amount i pay to the standard rate for the 30yr term ?

Any down sides to this approach

thanks

Nope doing this myself it's the best way to go in IMO you have much more flexibility.

phormium

A good plan, only downside if it matters is the slightly increased cost of life cover as it must be taken out for the original term of the mortgage, might cost slightly more per month for longer term but it can always be cancelled if mortgage ends early.

NIMAN

If you fail to pay it off early and pay it off in the full 30 yrs, you'll pay more interest, and so the property will cost you a fair bit more.

SBarrett

The longer the term, the lower the repayments, so the stress test amount is lower...you also have more disposable income after repayments to satisfy that test too. So the longer the term, the easier it is to get a mortgage and you can borrow more.


Steven