Long-term fixed-rate mortgages 'not a popular choice'
Published On 1 August 2007
Most people in the UK would not consider opting for a long-term fixed-rate mortgage, new research suggests.According to Abbey Mortgages, 54 per cent of people would definitely not consider taking out a 25-year fixed-rate mortgage. A further 23 per cent are unsure if they would ever consider such long-term borrowing.
Just 23 per cent of consumers thought that they would think about opting for a long-term mortgage to allow them to buy property.
The concerns that people raised about tying themselves into 25-year mortgages included future uncertainty (27 per cent) and the worry that they would miss out on better deals when interest rates dropped (18 per cent).
"It is clear that the public don't have much of an appetite for 25-year mortgages," commented Sue Hayes, director of Abbey Mortgages.
"We continue to see increasingly strong demand for our five and ten-year fixed deals, indicating that 25 years is just a step too far.
"Given the great cultural and economic changes we've seen in the past 25 years, this is not surprising. Few people are prepared to commit themselves to a deal for a quarter of a century."
However, a recent study revealed that around one in ten graduates think that they will never be able to afford to own a property if house prices continue to increase.
