Extending Your Mortgage Term When Remortgaging: Pros, Cons & What Lenders Look For
If you’re looking at your monthly outgoings and wondering how to ease the pressure, you might be asking yourself: Can I extend my mortgage term when remortgaging?
The good news is yes, it’s often possible subject to lender criteria, and it could help you reduce your monthly repayments, making your mortgage more manageable.
But before diving in, it’s important to understand how extending your term works, what lenders look for, and what it could mean for your long-term financial goals.
At Kerr & Watson, we’re here to guide you through this decision with honest, expert advice tailored to your needs.
What Does It Mean to Extend Your Mortgage Term?
Extending your mortgage term means increasing the length of time over which you repay your mortgage. For example, if you currently have 15 years remaining, you might consider increasing that to 20 or 25 years.
This change spreads your remaining balance over a longer period, lowering your monthly payments. It’s one of the most common reasons people consider remortgaging, especially during periods of rising interest rates or personal financial pressure.
You can explore this option either with your current lender or by remortgaging with a new one. Both routes come with pros and cons, and it’s important to get advice before making a decision.
Why Would You Extend Your Mortgage Term?
People consider extending their mortgage term for a variety of personal and financial reasons. Some of the most common include:
- Reducing monthly mortgage payments to ease financial pressure
- Coping with a change in income, such as maternity leave or a career change
- Preparing for retirement and aligning payments with pension income
- Freeing up cash for other life goals, like education, home improvements, or investing, wishing to spread the larger mortgage over a longer term
- Making mortgage repayments more manageable alongside other debt commitments
It’s not just about affordability, it’s also about flexibility. Life rarely stays the same for long, and your mortgage should work with you, not against you.
Find out Your Options
How Does Remortgaging Help?
When you remortgage, you’re essentially replacing your current mortgage with a new one, either with your existing lender or more commonly, a different one. This gives you the opportunity to adjust key aspects of the loan, including the term.
By extending the term at the point of remortgage, you could:
- Secure lower monthly repayments
- Release equity if your property has increased in value
- Restructure your mortgage around your current lifestyle and income
At Kerr & Watson, we help you assess whether remortgaging to extend your term is the right move and if so, we’ll source the most suitable product from the whole of the market. Due to additional interest over longer terms, it is not suitable for every borrower.
What Do Lenders Look At?
Lenders won’t automatically approve an extended mortgage term, they’ll want to assess your affordability, creditworthiness, and future financial plans. Things they may consider include:
- Your current income and outgoings
- Your credit score and existing financial commitments
- Your age now and at the end of the proposed mortgage term
- Your pension arrangements, if the new term goes past retirement age
Some lenders have maximum age limits, typically between 70 and 75, though others are more flexible and may consider lending up to age 80 or beyond. If you’re approaching retirement or already there, you’ll usually need to provide evidence of your expected pension income.
This is where having a broker will help. At Kerr & Watson, we know which lenders are open to longer terms and can help assess your application to ensure whether this is the best thing for you to do.
What Are the Drawbacks With Extending Your Term?
As with any financial decision, it’s important to look at the bigger picture. Extending your mortgage term does come with some downsides:
- You’ll pay more interest overall – Even if your monthly payment is lower, the total cost of the mortgage increases over a longer term.
- It may take longer to build equity – More of your payments go towards interest rather than repaying the capital in the early years.
- It could affect your future borrowing potential – Especially if you’re still repaying your mortgage into later life.
- Longer commitment – Extending the term ties you to a longer financial obligation, which may not align with goals like retiring early or being mortgage-free sooner.
That’s why it’s vital to weigh up the short-term savings against the long-term costs. We help you see both sides so you can make a confident and informed choice. Find out the longest term you can have.
Can You Extend Your Term Without Remortgaging?
In some cases, yes. You can ask your current lender to extend your mortgage term without remortgaging. This is treated as a change to the original terms and may involve a full affordability check, credit assessment, and potentially some fees.
The benefit of this route is that you avoid legal work, valuations, and possibly exit fees. However, your options may be more limited, and you won’t benefit from a full review of the mortgage market. It’s still worth comparing what’s available elsewhere before proceeding.
We can help you explore both options and decide whether sticking with your current lender or remortgaging is the better route for your situation.
Will Extending the Term Affect My Credit Score?
Extending your mortgage term, on its own, doesn’t typically impact your credit score. However, the process of applying, especially if it involves multiple credit checks or rejections, might have a small temporary effect.
It’s important to manage any changes through a professional who understands how lenders operate.
At Kerr & Watson, we guide you through every step, ensuring your application is well-prepared and minimising unnecessary hits to your credit file.
Conclusion
Extending your mortgage term when remortgaging can be a smart way to reduce your monthly payments and make life more affordable.
It’s not the right solution for everyone, but when used correctly and with the right advice, it can bring welcome financial breathing room.
Before deciding, it’s essential to understand the impact on your total repayments, your future plans, and what lenders require. That’s where we come in.
At Kerr & Watson, we take the time to understand your full financial picture. We’ll help you compare options, assess affordability, and secure a mortgage deal that’s tailored to your goals, whether that’s reducing your outgoings, releasing equity, or simply gaining some peace of mind.
Contact us today for independent advice.
