Homebuyers pay down mortgages faster
Canadians who have recently purchased real estate plan on paying off the mortgage as quickly as possible according to an annual mortgage consumer survey released Wednesday by Canada Mortgage and Housing Corp.
Seventy-eight per cent of respondents said they wanted to pay their mortgages off as fast as possible and one-third said they had made a lump-sum payment toward that end.
Eighty-four per cent of homeowners who are making weekly or biweekly payments on their mortgages are doing so at an accelerated rate in order help to shorten their amortization period, according to the mortgage insurer.
The fact that new homeowners are working to pay down principal early and are accelerating payments is a good indication that this responsible behavior will continue throughout the life of their mortgage.
More Canadians are becoming aware that, since mortgage interest is not tax-deductible in Canada, (as it is in the US), you are making mortgage payments of both principal and interest with money that you’ve already paid tax on “after tax dollars”. This makes it even more important to pay down your mortgage as soon as possible!