More than one in six people in the UK anticipate still having mortgage debt after reaching the age of 65, with nearly one in ten expecting to be over 70 or never pay it off, according to a recent survey by Opinium for HL.
Among those aged 55 and above with mortgages, 18% foresee repaying their loans beyond the age of 70, while 7% believe they will never clear their mortgage debt.
The average age for mortgage repayment has risen from 57 to 60 compared to the previous year.
The recent increase in mortgage rates is likely to compel more individuals to extend the duration of their mortgages into later stages of life.
Sarah Coles, head of personal finance at Hargreaves Lansdown, expressed concern over the financial implications of prolonged mortgage repayments in later life.
She said: “More than one in six people will still be paying the mortgage after the age of 65, and recent hikes in mortgage rates could force more of them to extend the loan later into their 60s, with implications for their finances.”
Coles also highlighted the agreement between lenders and the Government to facilitate temporary extensions of mortgage terms without affordability checks. She added: “It is designed to make short-term mortgage tweaks easier, but there’s a chance that people taking advantage may end up with a more permanent change, to make monthly payments affordable.”
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, emphasised the risks associated with planning to pay off mortgages in retirement. She said, “If you plan to keep working past retirement age to pay your mortgage, you need to appreciate that you may not be in control of when you stop work.”
Morrissey also stressed the importance of calculating pension income in advance to ensure it can cover the cost of mortgage payments without depleting retirement savings.
