First-time buyers face paying off mortgages in retirement as nearly half take out 35-year terms

By Liam Buckler · · Updated

First-time buyers are facing being forced to pay off mortgages in retirement as nearly half take out 35-year deals.

Heron Financial analysis seen by Newspage shows that among first-time buyer purchases on its books over the last 12 months to October 2026, almost half, 48%, took out mortgages lasting 35 years or more.

With many of these mortgages running beyond the age of 67, the state pension age currently being phased in, first-time buyers are stretching their loans over extended periods to make monthly repayments more affordable.

Many first-time buyers used Help to Buy, where the equity loan had to be repaid alongside the mortgage, while fees kicked in from year six at 1.75% of the loan and rose each year. 

However, if Prime Minister Andy Burnham's proposed Your First Home, which has just been announced, follows a similar model, buyers could face years more of fees simply because they have taken out a longer mortgage. 

The length of the interest-free period and what borrowers will pay afterwards are due to be confirmed in the Budget on 28 October.

The growing use of longer mortgage terms shows the increasing pressure first-time buyers are facing to keep monthly repayments affordable.

Matt Coulson, Founder at Rickmansworth-based Heron Financial, said: "It's becoming the norm, with nearly half now taking terms of 35 years or more. People don't do that casually. They stretch the term because it's the one lever that brings the monthly payment down to something they can afford. 

"It's the clearest sign of where the squeeze really is: the monthly cost. The trade-off is real. A longer term lowers the payment now but costs far more interest over the life of the loan, and pushes borrowing deeper into your working life, often to retirement. 

"Your First Home doesn't change that, and may even nudge it further: a smaller deposit means a bigger mortgage, and a bigger mortgage leans even harder on a long term to stay affordable. 

“On hidden charges, the one to watch is the equity loan. Under the old Help to Buy it was interest-free for five years and then started charging, so the cost arrives well after the headline deposit help. Factor the whole cost: the term, the interest and the equity loan repayment, well beyond the 2.5% to get in.”

Perfect sense

Sara Palmer, Chief Distribution Officer at Gen H, said 35-year mortgages can “make perfect sense”.

She added: "At Gen H, 37% of our first-time buyers have taken terms of at least 35 years. This rises to 64% for 30+ year terms. In this housing market, it's hard to imagine any other way for people to get on the ladder. It's absolutely true that a longer mortgage term can cost significantly more over the term of the mortgage. 

“But the reality is that this may be worth it for families with no other path to homeownership, with Your First Home or without it. It is tempting to get wrapped up in the numbers, but if a first-time buyer is comfortable making the payments, and owning is a priority, it may make perfect sense.”

One adviser says buyers should not fear the 35-year term – arguing it can act as a financial safety net.

Martin Rayner, Financial Adviser at Compton Financial Services, said: "We recommend a 35-year term to virtually all first-time buyers. It keeps the committed monthly payment as low as possible, while most mortgages allow borrowers to overpay by up to 10% of the balance each year without penalty.

"A 35-year term is the safety net, not the repayment plan. That flexibility matters. Job security is not what it was for previous generations, and most buyers will only fix for two or five years, after which they can change the term anyway. Your First Home should not fundamentally change that. 

“The bigger issue is ensuring buyers understand the true cost of the equity loan. If the Government takes a 20% equity share, you are also giving away 20% of any increase in value. Borrow £40,000 against a £200,000 home and, if it rises to £250,000, you could have £50,000 to repay. If fees / high interest is charged after the interest-free period, buyers need to understand that cheap at the start does not necessarily mean cheap over the long term.”

True cost

Richard Davidson, Mortgage Advisor at onlinemortgageadvisor.co.uk, said the real concern is whether buyers can pay off the debt quickly enough.

He added: "Long terms are now the norm for many first-time buyers, but the real issue with Your First Home is not that anyone will run a 35-year mortgage to the end, it is that they may not be paying it down fast enough. 

"Like Help to Buy, this equity loan is designed to be temporary, with the idea that once the interest-free period ends, and while the fees are generally still lower than mortgage rates, owners have built up enough equity to fold the loan into their mortgage.

“Buyers also need to remember the loan is a share of the home, so if prices rise, what they owe rises with it. If it mirrors Help to Buy, the sensible plan is to repay at the five-year mark, or by year ten at the latest, and to run those numbers from day one, because my worry is that some buyers will see it, or be sold it, as free money rather than a debt that needs a clear exit.”

Tracey Dixon, Buy-to-Let Mortgage Specialist & Owner at Cardiff-based Pure Mortgage and Protection, said buyers need clear illustrations of future costs and a realistic repayment plan from the outset.

She commented: "Getting the keys is only the first hurdle. Buyers also need a realistic way to repay the help that got them through the door. A longer mortgage term can make monthly payments more manageable, but it should be an individual recommendation, with the overall interest cost and retirement plans considered.

"My concern with any new equity loan scheme is what happens later. If buyers already need 35 or 40 years to make the mortgage affordable, how will they fund any additional charges and ultimately repay the equity loan?

“We should not build affordability around the hope that salaries and house prices will rise. Buyers need clear illustrations of future costs and a realistic repayment plan from the outset. Until the scheme’s full terms are confirmed, a smaller deposit alone is not enough to judge its value. Success should mean sustainable homeownership, not simply more completed purchases.”

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The raw alert

The question we put to Newspage’s experts, and their answers.

Show the original alert and 15 responses

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Are first-time buyers getting mortgages up to 35 years? How will Your First Home change that?

ended 05. October 2026

A Newspager, using figures from his company's first-time buyer purchases in England, 12 months to October 2026, said 48% took a mortgage term of 35 years or more. While the typical mortgage runs until the older borrower is 67, which is state pension age.

Under Help to Buy, the equity loan had to be paid off when the mortgage was, and from year six it charged a fee of 1.75% of the loan, rising every year. If Your First Home works the same way, a longer mortgage could mean paying those fees for longer. The length of the interest-free period and the fees after it are due to be confirmed at the Budget on 28 October.

Market context: FCA figures show sales of mortgages with terms of 35 years or more rose from around 261,000 in 2021 to almost 319,000 in 2025. Among main borrowers aged 36-40, they more than tripled, from about 9,000 to over 31,000. Those figures cover all regulated mortgages, not just first-time buyers.

  • Are first-time buyers getting mortgages up to 35 years?
  • How will Andy Burnham's Your First Home change that?
  • Could it introduce hidden charges?

Responses by tomorrow.

15 responses from the Newspage community

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Tony SanchezVerified
Founder at Bridging Loan Directory
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Longer mortgage terms can make monthly repayments more manageable, but they also mean paying interest for longer. The figures shared with Newspage suggest that trade-off is already common among the buyers in that company’s sample.

Your First Home could reduce the mortgage needed through its equity loan. Whether buyers can then choose shorter terms will depend on their income, mortgage rates and the scheme’s final costs.

I would avoid calling those costs “hidden” before the rules are published. The important question is whether buyers receive clear illustrations of payments after the interest-free period, how repayment is calculated and when the equity loan must be repaid. Under Help to Buy, interest payments did not reduce the equity debt, and the loan was normally due after 25 years, even with a longer mortgage.

A scheme should help buyers understand and sustain the whole funding arrangement over time.
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Martin RaynerVerified
Financial Adviser at Compton Financial Services
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We recommend a 35-year term to virtually all first-time buyers. It keeps the committed monthly payment as low as possible, while most mortgages allow borrowers to overpay by up to 10% of the balance each year without penalty.

A 35-year term is the safety net, not the repayment plan.

That flexibility matters. Job security is not what it was for previous generations, and most buyers will only fix for two or five years, after which they can change the term anyway.

Your First Home should not fundamentally change that. The bigger issue is ensuring buyers understand the true cost of the equity loan. If the Government takes a 20% equity share, you are also giving away 20% of any increase in value. Borrow £40,000 against a £200,000 home and, if it rises to £250,000, you could have £50,000 to repay.

If fees / high interest is charged after the interest-free period, buyers need to understand that cheap at the start does not necessarily mean cheap over the long term.
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Stephen PerkinsVerified
Norwich Mortgage Broker and Managing Director at Yellow Brick Mortgages
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Longer mortgage terms are increasingly common for first-time buyers because they reduce the compulsory monthly payment and can make the purchase affordable today. That doesn’t necessarily mean somebody will take 35 years to repay the mortgage, because the term can be reviewed later and borrowers can often overpay when their finances improve.

With Your First Home, the important detail will be how the equity loan works alongside that mortgage. If charges start after an initial interest-free period, buyers need to understand the cost of both debts over time rather than looking only at the lower monthly mortgage payment.
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Craig FishVerified
Director at Lodestone Mortgages
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Nearly half of first-time buyers now sign up for 35 years or more, and it is no longer a niche choice. It is how a lot of people make the monthly sums add up, with the typical deal running until the older borrower is 67. The FCA's own figures show 35-year-plus deals among main borrowers aged 36 to 40 more than tripled between 2021 and 2025. Your First Home could make that costlier. Under Help to Buy the equity loan was due when the mortgage ended, and from year six it carried a fee of 1.75% of the loan, rising every year. Copy that model and a longer mortgage means paying those fees for longer, possibly into retirement. A free loan with a fuse on it is not free. Those are the charges buyers don't see on the brochure, because they don't land until years after the keys. Ministers have yet to confirm the interest-free period or what follows it, and that detail at the Budget will decide whether this helps buyers or hooks them. Anyone weighing it up needs advice that looks past year five.
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Justin MoyVerified
Managing Director at EHF Mortgages
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I find that most First Time Buyers are stretching their affordability to buy 'big', so the starting point for monthly cost always starts at a 35yr term. It's important to understand that this doesn't mean this term is locked in forever; it's just a means of calculating payments to an affordable level now, and where income improves over time, the term can be shortened regularly. A few borrowers have taken a 40yr term, not something I would encourage, but it is done with our clients' eyes wide open. With YFH, a maximum term of say 35yrs will likely be one of the rules, as will a physical limit on the mortgage that can be borrowed, as with HTB, which was based on a multiple of income (x4.5) and overall affordability.
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Richard DavidsonVerified
Mortgage Advisor at onlinemortgageadvisor.co.uk
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Long terms are now the norm for many first-time buyers, but the real issue with Your First Home is not that anyone will run a 35-year mortgage to the end, it is that they may not be paying it down fast enough. Like Help to Buy, this equity loan is designed to be temporary, with the idea that once the interest-free period ends, and while the fees are generally still lower than mortgage rates, owners have built up enough equity to fold the loan into their mortgage.

Buyers also need to remember the loan is a share of the home, so if prices rise, what they owe rises with it. If it mirrors Help to Buy, the sensible plan is to repay at the five-year mark, or by year ten at the latest, and to run those numbers from day one, because my worry is that some buyers will see it, or be sold it, as free money rather than a debt that needs a clear exit.
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Tracey DixonVerified
Buy-to-Let Mortgage Specialist & Owner at Pure Mortgage and Protection
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Getting the keys is only the first hurdle. Buyers also need a realistic way to repay the help that got them through the door.

A longer mortgage term can make monthly payments more manageable, but it should be an individual recommendation, with the overall interest cost and retirement plans considered.

My concern with any new equity loan scheme is what happens later. If buyers already need 35 or 40 years to make the mortgage affordable, how will they fund any additional charges and ultimately repay the equity loan?

We should not build affordability around the hope that salaries and house prices will rise. Buyers need clear illustrations of future costs and a realistic repayment plan from the outset.

Until the scheme’s full terms are confirmed, a smaller deposit alone is not enough to judge its value. Success should mean sustainable homeownership, not simply more completed purchases.
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Sara PalmerVerified
Chief Distribution Officer at Gen H (Generation Home)
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At Gen H, 37% of our first-time buyers have taken terms of at least 35 years. This rises to 64% for 30+ year terms. In this housing market, it's hard to imagine any other way for people to get on the ladder.

It's absolutely true that a longer mortgage term can cost significantly more over the term of the mortgage. But the reality is that this may be worth it for families with no other path to homeownership, with Your First Home or without it.

It is tempting to get wrapped up in the numbers, but if a first-time buyer is comfortable making the payments, and owning is a priority, it may make perfect sense. They can always repay their mortgage to settle the mortgage earlier, too.

New Build Boost from Gen H only charges interest on the 80% main mortgage, not the 15% equity loan boost. I wonder if more schemes like this from the private sector may bring the best of both worlds to aspiring homeowners: a path onto the ladder without the uncertainty of a rising interest rate.
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Nouran MoustafaVerified
Practice Principal & IFA at Roxton Wealth
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Thirty-five year mortgages are absolutely becoming normal for first-time buyers. They solve one problem brilliantly: the monthly payment. But they can also push debt much further into working life.

Your First Home could reduce the mortgage needed because the government would take a 20% equity stake alongside a 2.5% deposit. That may improve affordability at the start.

The unanswered question is what happens later.

Under Help to Buy, interest started from year six and the equity loan had to be repaid when the mortgage was repaid, the property sold or the loan term ended. If Your First Home follows a similar structure, a very long mortgage could mean carrying the equity loan and its charges for much longer.

I would not call those “hidden charges” if properly disclosed. But they could become very expensive future costs.

Cheap today is not the same as cheap over 35 years.
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Ross LaceyVerified
Director at Fairview Financial Management
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We tend to see 35-40 year mortgage terms for most of our first time buyer cases. However, we are also seeing an increasing amount of first time buyers in their 50s, so for them the term is limited by their retirement age.

One of the main reasons for longer terms on mortgages could be higher average mortgage interest rates in 2025 compared with what they were during 2021.
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Harvey DhillonVerified
Founder & CEO at Zmartly
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Long mortgages have gone mainstream for first-time buyers. On FCA figures for 2024, 45 per cent of them borrowed for 35 years or longer. Nothing announced yet changes that, but England's last Help to Buy scheme tied the equity loan's term to the mortgage. If Your First Home copies it, a 35-year mortgage could mean a 35-year equity loan. After the interest-free period you would pay interest on it every year, on the amount first borrowed, rising every April and never reducing what you owe. On Homes England's own worked example, run to 35 years, that interest would add up to about as much as was borrowed, with the whole loan still owed at the end, as a share of the home's value then. None of that would be hidden, since Help to Buy published it. That's an expensive form of help. When the Budget sets out the detail, add up that interest over the whole mortgage and plan the cash to repay the loan.
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Jamie AlexanderVerified
Mortgage Director at Alexander Southwell Mortgages
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35 year terms are not unusual at all, particularly for first time buyers in higher cost areas. When affordability is already stretched, extending the term is often the only lever left to make the monthly payment work. The FCA data reflects what we see in practice. Longer terms are becoming the norm rather than the exception.

The Your First Home scheme carries the same tension that Help to Buy did. An equity loan tied to the mortgage term sounds straightforward until you consider that a 35 year mortgage means potentially paying fees on that loan for a very long time. Under the old Help to Buy structure the fee started at 1.75% from year six and rose annually. On a significant equity loan that compounds into a meaningful hidden cost over time.

Until the Budget confirms the interest free period and what happens after it, buyers cannot properly assess the true cost of the scheme. That lack of clarity is a problem.
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James BlacklerVerified
Managing Director at Oakstead Finance
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Stretching a mortgage to 67, the state pension age, isn't the red flag it sounds like, it's a rational response to affordability pressure, particularly in London where we routinely push terms to 40 years to get clients the loan amount they need. A buyer in their late twenties or early thirties with a clear career trajectory can absolutely manage that, especially with a pragmatic overpayment strategy once disposable income improves rather than being locked into an unaffordable 25-year term. What worries me more about Your First Home is the fee mechanics. Help to Buy's equity loan was interest-free for five years, then charged 1.75% in year six, rising each year after that by inflation plus 1 to 2 percentage points. Those charges were at least capped at a 25-year loan term. If this scheme copies that structure without the cap, a 35 or 40-year mortgage term means those charges run for far longer. The Budget needs to spell that out clearly, not bury it.
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Matt CoulsonVerified
Founder at Heron Financial
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Yes, and it's becoming the norm, with nearly half now taking terms of 35 years or more. People don't do that casually. They stretch the term because it's the one lever that brings the monthly payment down to something they can afford. It's the clearest sign of where the squeeze really is: the monthly cost. The trade-off is real. A longer term lowers the payment now but costs far more interest over the life of the loan, and pushes borrowing deeper into your working life, often to retirement. Your First Home doesn't change that, and may even nudge it further: a smaller deposit means a bigger mortgage, and a bigger mortgage leans even harder on a long term to stay affordable. On hidden charges, the one to watch is the equity loan. Under the old Help to Buy it was interest-free for five years and then started charging, so the cost arrives well after the headline deposit help. Factor the whole cost: the term, the interest and the equity loan repayment, well beyond the 2.5% to get in.
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Paula Higgins
Founder at HomeOwners Alliance
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“Our research earlier this year revealed just how divided Brits were about where mortgage rates would go next: 23% expected them to rise, 25% thought they would fall, 28% expected no change and 24% were unsure. With the average five-year fixed rate now hitting 6%, those who anticipated further rises have seen their concerns borne out.

“For homeowners facing a jump of nearly £2,000 a year in mortgage payments, this is a serious squeeze on household budgets, particularly when other bills are also rising. [Note: can provide tables]

“But uncertainty about what happens next makes it all the more important to plan ahead. If your current deal ends within the next six months, speak to a mortgage adviser and explore your options now.

“Securing a deal in advance can protect you against further rises. Your adviser can then keep it under review and check whether you could move to a cheaper deal if rates fall before your new mortgage starts, subject to the lender’s terms.”