How do I extend my mortgage term?

What is a mortgage term?

Most people with a mortgage will be on a repayment mortgage, meaning that they’ll make monthly repayments for the set mortgage term. This could be 25, 30, or sometimes 35 years. After this time you will own your home outright, having fully paid it off.

Some homeowners may consider extending their mortgage terms to lower their monthly payments. But can you extend your mortgage term, and what are the pros and cons of doing so?

Can I extend my mortgage term?

Yes, UK homeowners can extend their mortgage terms, subject to lender approval. Extending your mortgage term can be an option to manage monthly payments, especially if circumstances have changed since the initial mortgage agreement.

Keep in mind that your lender may not agree to extend your mortgage if:

  • the extended term will still be active beyond your 75th birthday

  • you don’t pass their affordability requirements for a longer term

  • you want to extend your mortgage but are already on a 40-year term 

What are the benefits of extending your mortgage? 

Reduced monthly payments

Extending your mortgage term typically leads to lower monthly payments, making it more manageable for homeowners facing financial constraints.

Increased cash flow

Lower payments can free up cash that can be redirected toward other essential expenses or investments.

Flexibility

A longer mortgage term provides increased flexibility in budgeting, especially during periods of economic uncertainty.

Avoiding arrears

Extending the term can prevent falling into arrears or defaulting on payments, thus protecting your credit score and preventing potential repossession.

What are the disadvantages of extending your mortgage?

Higher total interest paid

Extending your mortgage term may lead to paying more interest over the life of the mortgage, increasing the overall cost of the loan.

Longer debt repayment

A prolonged mortgage term means a more extended period of debt repayment, potentially delaying financial freedom.

Interest rate changes

Some lenders may adjust the interest rate when extending the term, impacting the overall cost and monthly payments.

Potential restrictions

Certain mortgage deals or lenders may have limitations on extending the term, making it essential to explore available options.

How do I extend my mortgage term?

1. Contact your lender

Start by reaching out to your current mortgage lender to discuss your intention to extend the mortgage term. They can provide insights into available options and any associated costs.

2. Affordability assessment

Lenders will assess your financial situation to ensure you can manage the extended term. This involves reviewing your income, expenses, and credit history.

3. Explore remortgaging

If your current lender is unable to offer favorable terms, consider remortgaging with a different lender. Compare offers to find the best fit for your needs.

4. Seek professional advice

Consult a mortgage advisor or financial expert to navigate the complexities of mortgage extensions. They can provide personalized guidance and help you make an informed decision.

5. Review terms and conditions

Thoroughly review the terms and conditions of the extension, including interest rate changes, monthly payments, and any associated fees.

6. Legal considerations

Engage a solicitor or conveyancer specializing in property law to ensure the extension process adheres to legal requirements.

7. Complete the application

Provide all necessary documentation as requested by the lender, such as income proof, identification, and property details.

8. Monitor your financial situation

Regularly assess your financial stability after extending the term. Consider making extra payments when possible to avoid the impact of increased interest payments.

Extending your mortgage term can offer valuable financial relief and flexibility. By understanding the benefits and drawbacks, seeking professional advice, and carefully evaluating the terms, you can make an informed decision that aligns with your long-term financial goals. Remember to consider both the short-term benefits and long-term costs before proceeding with a mortgage extension.

Important info & marketing claims

You may have to pay an early repayment charge to your existing lender if you remortgage. Your savings will depend on personal circumstances.

Your home may be repossessed if you do not keep up repayments on your mortgage.

*The savings figure of £656 is based on Better.co.uk remortgage customers in April 2024. Read more on our marketing claims page.

We can't always guarantee we will be able to help you with your mortgage application depending on your credit history and circumstances.

Average mortgage decision and approval times are based on Better.co.uk's historic data for lenders we submit applications to.

Tracker rates are identified after comparing over 12,000 mortgage products from over 100 mortgage lenders.

As of January 2023, Better.co.uk has access to over 100 lenders. This number is subject to change.

For buy-to-let landlords, there's no guarantee that it will be possible to arrange continuous letting of a property, nor that rental income will be sufficient to meet the cost of the mortgage.