Length of mortgage

2Clueless

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I’m 44 and bidding on my first house. Teaching for 18 years. This house is perfect for me and, as expected, it’s got a lot of interest. If successful, it will mean a mortgage of 18 years. Does that length sound reasonable?
 
With BoI (and I think one other provider) you can overpay by 10% without penalty on a fixed rate.

Top of my head, that would take 3 years off your mortgage.

Better to get a longer term, and overpay when you can. Gives you more flexibility.
 
I think you need to explain what you mean by reasonable? Do you mean reasonable repayments result? Do you mean reasonable as in what age you will be when you have it fully paid off? The "ideal" term depends on a number of factors. For example, if you are 25 years old, then IMO it is probably not reasonable, as it will result in quite high monthly payments. However, if you are 48, the an 18 year mortgage would suit, as you would be unlikely to get much or a longer term. Anything under 20 years seems short to me anyway. I would suggest to a 20 year mortgage and overpay it. Hence, weigh up the monthly repayments for an 18 year mortgage and see if they are comfortable or will you be watching it every month. If its the latter, lengthen the term.
 
I am not sure if the term is the most relevant factor.

What is the value of the house?
What is the size of your mortgage?
What is your income?

If you fit the criteria, then choose as long a term as possible. As others have pointed out, it's easy to overpay. You get into real trouble if you underpay.

Brendan
 
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