Go to Main Content

Advertisement

By David Hodges on December 30, 2014

Why borrowers are smarter than they look

By David Hodges on December 30, 2014

A new study shows that mortgage holders are paying off their homes faster and faster

Advertisement

Canadians are constantly criticized taking on too much debt in today’s low interest rate environment. But a new study shows that mortgage holders are paying off their homes faster and faster, thanks to extra payments that are applied to the principal owing rather than the interest. The result is the average amortization has dropped from 25 years to 20. Making extra payments has another benefit for borrowers: In the event of a rate hike, you can simply return to your regular amortization payment schedule.

Borrowers

Source: Bank of Canada, Statistics Canada, CIBC

Comments Cancel reply

Related Articles

Bank of Canada Governor Tiff Macklem during a news conference

Bank of Canada cuts interest rates to combat slowing economy

The Bank of Canada lowers its interest rate to 2.5%, aiming to boost growth amid economic weakness, with more...

Bank of Canada cuts interest rates to combat slowing economy

A middle-aged woman on a couch with her daughter

Do you need long-term care insurance?

More and more Canadians require hands-on personal care in their declining years, but few plan ahead for it. Here...

Do you need long-term care insurance?

A young woman surrounded by moving boxes in her new home

Looking for a mortgage in B.C.? Don’t limit your options to the big banks

Looking for a mortgage in B.C.? Don’t limit your options to the big banks

Close-up of Bank of Canada building in Ottawa

Making sense of the Bank of Canada interest rate decision on July 30, 2025

How a third consecutive rate hold from the Bank of Canada impacts borrowers, investors, and savers

Making sense of the Bank of Canada interest rate decision on July 30, 2025

A smiling young couple hold a key in their new home

5 smart strategies for renewing your mortgage

5 smart strategies for renewing your mortgage

A young mom and dad sing with their toddler daughter

Lowest Winnipeg mortgage rates: Save with Cambrian Credit Union

Lowest Winnipeg mortgage rates: Save with Cambrian Credit Union

A Canadian family moving, thanks the BoC rate cuts, which improved mortgage affordability in Vancouver, Toronto and Hamilton

How much income do you need to buy a home in Canada? A look at housing affordability in June 2025

How much income do you need to buy a home in Canada? A look at housing affordability in June 2025

Is it (finally) a buyer’s market in cottage country?

If you’re thinking about buying your first recreational property, now may be the right time. Here's what to know.

Is it (finally) a buyer’s market in cottage country?

couple examines mortgage renewal documents on living room floor

Renewing your mortgage? A guide for Canadians

We’ve put together all the tools and strategies you need to manage the shock of renewing your home loan...

Renewing your mortgage? A guide for Canadians

Canadian couple in their first home happy the BoC held its rate.

Making sense of the Bank of Canada interest rate decision on June 4, 2025

Making sense of the Bank of Canada interest rate decision on June 4, 2025