Brits are increasingly carrying mortgage debt into retirement, according to new data from mortgage overpayment app Sprive. The figures reveal an age divide among homeowners, with older people more likely to hold a mortgage on their own.
Older homeowners starting mortgages later
The analysis suggests older homeowners are not carrying mortgage debt into later life because they have taken out longer mortgage terms, but because they have simply started their mortgages later. While 68% of under-30 homeowners in the data are on a 30 to 40-year mortgage term, this falls to 45% among those aged 30 to 39 and just 7% among 40 to 49-year-olds. Virtually none of those aged 50 and over are on a 30 to 40-year term.
As a result, even with shorter mortgage terms, older borrowers' mortgages are more likely to run into retirement, making it particularly important to pay down the debt as quickly as possible, Sprive adds.
Projected mortgage-free ages rising
The average projected mortgage-free age rises steadily across age groups: from 59 among under-30s to 63 for those aged 30 to 39, 65 for 40 to 49s, 67 for 50 to 59s, and 72 among homeowners aged 60 and over.
Making overpayments where possible can "make an even bigger difference, helping to clear the debt sooner and reduce the amount of interest paid over the lifetime of the mortgage", experts say.
Expert urges small regular overpayments
Jinesh Vohra, CEO and founder of Sprive, said: "Our data suggests that solo homeownership is less of a young first-time buyer story and more likely to reflect people buying alone later in life - whether they have always bought alone, are buying following a relationship breakdown, or could perhaps only afford a mortgage in later life."
He added: "Our data shows that solo homeownership becomes much more common with age, with more than one in four homeowners aged 50+ carrying a mortgage on their own. With some people now facing mortgage payments into their 60s and 70s, finding ways to reduce that debt is more important than ever - particularly when there is only one income to rely on. The good news is that you don't necessarily need to find large sums to make a difference."
"Small, regular overpayments can add up, and Sprive makes it easy to turn everyday spending into extra mortgage payments, helping homeowners reduce their balance, cut interest and bring forward the day they become mortgage-free."
