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ISCOVER
Staff Reporter
While 25-year home loans were en vogue prior to the global financial crisis, the most popular loan term has changed.
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According to data from Loan Market, the most popular loan term is now 30 years.
Loan Market spokesperson Paul Smith said 30-year loan terms are popular with borrowers who are looking for significant flexibility.
However, he went on to add that 30-year home loans also come with a few pitfalls.
“On a 30-year loan term for a $300,000 mortgage, your repayments are going to be about $40 a month less than a 25-year term, but you’re going to pay about $75,000 more in interest by taking five more years to pay off your home loan,” he said.
