As house prices continue to soar, many first-time buyers are facing challenges in getting onto the property ladder. However, a new mortgage trend called “marathon mortgages” has emerged as a potential solution for aspiring homeowners. In this blog post, we will explore what marathon mortgages are, their benefits and drawbacks, and whether they are the right choice for you.
 What are Marathon Mortgages?
Marathon mortgages refer to mortgages that are paid back over longer periods of time than traditional mortgages. Previously, homebuyers typically had mortgage terms of 25 years. However, due to rising property prices, the average mortgage term has increased to around 30 or 35 years, with some lenders even offering terms of up to 40 years. This extended repayment period allows borrowers to take on bigger mortgages.
 Benefits of Marathon Mortgages
One of the primary benefits of marathon mortgages is that they enable first-time buyers to afford more expensive properties. By spreading out the loan repayment over a longer term, borrowers can reduce their monthly mortgage payments, making homeownership more attainable. Moreover, the availability of longer-term mortgages has increased as lenders become more willing to lend past the state retirement age.
Drawbacks to Consider
While marathon mortgages can be advantageous, they also come with drawbacks. One significant consideration is the additional cost over the extended repayment period. With a longer term, borrowers end up paying more in interest. For instance, borrowing £300,000 over 25 years at a rate of 4.98% would result in £225,320 in interest payments. In contrast, borrowing the same amount over 40 years would lead to £392,887 in interest, a substantial difference.
 Is a Marathon Mortgage Right for You?
Determining whether a marathon mortgage is suitable for your situation depends on various factors. Younger borrowers, particularly those under 30, may find that the extended term provides an opportunity to enter the housing market. They have more time to reduce the mortgage term as their income increases or they build equity in their property. However, it is crucial to consider potential risks. If income does not increase or retirement plans involve a lower income, selling the property and downsizing may be necessary to maintain affordability.
 Consider Your Long-Term Goals and Budget
Before opting for a marathon mortgage, carefully evaluate your long-term goals and budget. While a longer mortgage term may initially seem attractive, it can pose challenges down the line. Uncertain future circumstances and the desire for flexibility during retirement should be factored in. Ideally, choose the shortest possible term that is feasible for your current financial situation to minimize the risk of being burdened by a mortgage in the future.
Marathon mortgages can provide a viable path to homeownership for first-time buyers facing affordability constraints. By spreading out the repayment over an extended period, borrowers can buy more expensive properties and reduce their monthly payments. Nevertheless, it is crucial to weigh the trade-offs carefully. Considering long-term goals, potential income changes, and retirement plans is essential. If you decide to explore marathon mortgages, work closely with a mortgage professional to find the best fit for your financial situation. Take the first step towards achieving your dream of owning a home.