One in five mortgages for first-time buyers is for a term longer than 35 years - twice the proportion seen just two years ago. In 2005, it was only 2 per cent.
Ultra-long mortgages will 'come home to roost' as households are left with less money towards retirement, a trade body has warned.
'The longer a customer needs to make mortgage payments, the less free income they may have over this period for other important considerations, not least contributions into their pensions,' according to a report by UK Finance. The comments, in a quarterly review of household finances, said this was an example of the 'affordability crunch' facing borrowers.
Although mortgage rates have eased from their highest levels, the proportion of extra-long deals was only down to 21 per cent in March. 'Rather than just stretching terms as a means of improving affordability to enter the market, more customers are needing to do this in subsequent mortgages, further on in their homeownership journeys and working lives.'
'Borrowers need to be disciplined in reviewing the term, or overpaying wherever possible, to reduce that burden.
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