Number of ultra-long mortgages due to run past state pension age

Young home buyers are being forced to gamble with their retirement prospects by taking on ultra-long mortgages, according to a former pensions minister.

Under-30s made up 3,676 of these mortgages, people aged 50 to 59 accounted for 18,854, 60 to 69-year-olds made up 4,955 and people aged 70-plus made up 661. Even if mortgages only run up to pension age, it deprives people of a period running up to retirement when they could be mortgage-free and boosting their pension, he said.

"We already know that millions of people are not saving enough for their retirement and if some of that limited retirement saving has to be used to clear a mortgage balance at retirement they will be at even greater risk of poverty in old age. She said that building societies recognise the need to consider different income and expenditure sources and needs, different lifestyle risks, different capacity to weather financial shocks.

Mortgage rates have been creeping up in recent weeks, as lenders have adjusted expectations over a base rate cut. According to financial information website Moneyfacts, the average two-year fixed homeowner mortgage rate on Friday was 5.94%, up from 5.93% on Thursday.

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