Mortgage Term - Length over which mortgage is repaid
A mortgage term is the period of time, over which a mortgage loan to purchase property is taken. Many mortgages come established with a 25 year term however other lengths of term for mortgage loans may be available subject to customers individual circumstances, credit status and with the consent of the mortgage lender.
Mortgage Terms Example
The length of mortgage terms can vary, from short to long.
With a mortgage loan with a short term the monthly repayments on the mortgage could be quite substantial in size, although this also means that the total interest paid on the mortgage will be lower.
With a mortgage loan with a longer term, monthly repayments should be smaller in size and easier to manage which could help with budgeting, although this also means that the total interest paid on the mortgage will be higher.
Mortgage Information.
The size of the repayments on a UK mortgage loan are reliant on many factors such as,
- Base interest rate set by the Bank of England
- Lenders interest rate
- Type of mortgage loan
- Size of mortgage loan
- Length of mortgage term
- Customers credit status.
When arranging any mortgage or other finance customers should pay attention to all of the above as well as their ability to pay, and electing to shorten any loans term should only be done when certain of positive circumstances.