40 year mortgage amortization

A recent analysis of the lending policy of the top 125 mortgage lenders found that around 30% with respect to the mortgage of 40 years more. Furthermore this trend to greater mortgage is becoming more popular since the first time buyers struggle to respond to the Head .

Long-term mortgage of 40 years and more have been criticized by some groups who claim that the consumer is likely to ensure the debt burden of households. There are some problems which arise in 40 years, mortgages.

1. Buyers will pay much more interest the longer the mortgage term. This effectively reduces their disposable income for the period of their mortgage.

2. There are perhaps some people still have a mortgage in retirement. There are doubts whether the people in the situation, their mortgage payments in retirement.

3. More mortgage terms are often synonymous with borrowing far greater quantities. It allows consumers to mortgages of up to 5 or 6 times there salary. This increases their potential debt burden if interest rates were to crash or house prices fall. It makes the consequences of negative equity more seriously.

4. More mortgage conditions have enabled more people to buy and so were the inflated real estate prices over their sustainable level

Despite these criticisms, there are some advantages in terms of mortgage of 40 years.

1. Without a mortgage of 40 years, many UK first time buyer would not be able to buy. In the long term buying is a better option than renting. It is true that people may have mortgage payments close to retirement, but if they continue to rent instead of buy, then they are also willing to pay rents.

2. Over a period of 40 years, inflation reduces the real value of mortgage payments, so they are easier to pay.

3. Home ownership a greater stability than rent. If you rent then you are always at the mercy of the landlord.

4. If your financial situation improves, then in the future you should be able to make your mortgage to a flexible system that gives owners the opportunity to pay off the mortgage 40 years early.

It seems that 40-year mortgages are here to stay. They are a response to the changing climate of the UK property market and a reflection of the increasing flexibility. While property prices are still on these record levels will continue an attractive option for UK homeowners

R. Pettinger manages a site about Mortgages in the UK http://www.mortgageguideuk.co.uk This site contains a guide for different types of mortgages and news about UK mortgages and the economy of the United Kingdom