How do mortgages really work, and what factors shape the true cost of buying a home? 

In this lesson students build a clear understanding of what a mortgage is and how it shapes long term financial outcomes. They begin by comparing house prices with the total repayment cost over 25 years, learning how interest dramatically increases what buyers eventually pay. This helps them recognise that mortgages are not just large loans, but long term commitments that require careful planning.

Students then explore the mortgage process in the UK and analyse a series of real world profiles to understand how factors such as income, savings, job stability, family situation and timing influence someone’s ability to secure a mortgage. Through guided discussion they identify strengths, risks and potential challenges in each scenario and consider what actions individuals could take to improve their financial position.

By the end students have a stronger grasp of how mortgage decisions are made, how interest rates and repayment terms affect affordability and why understanding risk is essential before taking on a long term financial commitment.