Young Scots expect to work past retirement age to pay off mortgage, finds study

A study by Halifax found 30 per cent of people aged between 20 and 45 north of the Border believe they will have to keep working to clear off the loan after they have reached their standard retirement age.

The figure was lower than that for the whole of the UK, which stands at 34 per cent.

About two-fifths of young people in Scotland said they are worried they will not be able to afford mortgage payments once they are retired.

Again, the percentage was slightly lower in Scotland than the overall UK figures, which stands at 44 per cent.

Craig McKinlay, mortgages director at Halifax, said that home ownership clearly remains a “key aspiration” for young people, with some becoming “increasingly resourceful” in their fight to reach the ladder.

But he said borrowers should be cautious about extending their mortgage term beyond 25 years - as it could increase the overall cost of the mortgage, and have a knock-on effect on quality of life in retirement.

He said: “A longer term will reduce monthly payments, but as home owners build up equity they should look to reduce this term or make overpayments to ensure that the dream of owning their own home doesn’t turn into an unnecessary nightmare in later years.”