1 in 3 borrowers now paying off their mortgages in their 60s and 70s

Around 35 per cent of all mortgage borrowers will carry on paying off their debts well into their late 60s and 70s, a new report from the Council of Mortgage Lenders (CML) has revealed.

This time last year, the professional body, which represents the UK's lenders, reported a rise in the number of over-65s still paying off their mortgages, even if they are no longer in full-time employment.

Such a trend is largely the result of the fact that, for a variety of reasons, Britons are now buying their homes later on in life than before, with this having a knock-on effect as people try and move up the property ladder in their 40s and even their 50s.

Should a borrower sign up for a standard 25-year mortgage deal, they could realistically still be paying off their debts well into their 70s, with the same figures also revealing that the nation's lenders have become much more relaxed about taking on 'older' individuals and couples as customers.

Now, one year on from the initial report, the CML has reported that not much has changed: that is, there has been no real change in the number of older borrowers, while the proportion of total UK borrowers who have yet to pay off their mortgage despite having reached the statutory age of retirement is similarly unchanged.

Notably, the CML has stressed that, while they may no longer be in full-time employment and so drawing a full wage, most older borrowers are not financially stretched by their mortgage commitments.

In fact, most older borrowers are near the end of their terms, with the vast majority of them succeeding in paying off their mortgages in full by the time they hit 70.

"It is important to understand, however, that just because someone is paying off part of their mortgage beyond the nominal retirement age of 65, it does not imply that they are experiencing payment problems," the CML paper notes.

"The overwhelming majority are paying off their loan successfully and fully in line with their mortgage commitments. For many of these borrowers, their monthly payments are modest relative to their incomes."

At the same time, however, the figures also show that there are still some people paying off their mortgages into their 80s. For them, lenders are increasingly ready to offer them so-called 'lifetime mortgages', with this type of product now accounting for 40 per cent of all lending to the over-65s.

Hand-in-hand with this increase in older mortgage holders is an ongoing drop in the number of younger adults taking out a mortgage on a property of their own.
Indeed, according to the data, the proportion of total UK mortgage-holders aged between 25 and 44 has been steadily falling over the past few years, with the number of borrowers aged 33 dropping the most.

While some younger consumers may be reluctant to commit themselves to taking out a mortgage and buying a home of their own, and so making a conscious decision to carry on renting, many more are simply struggling to save up enough money for a deposit, ensuring that the average age of a first-time buyer in the UK has continued to rise and that the number of people still paying off their home loans in their 60s, 70s or even beyond this will continue to rise over the foreseeable future.