Mortgage Blog

Low Rates in Red Deer and Calgary, Alberta Helping Buyers Pay Off Their Mortgages at Record Pace

June 28, 2021 | Posted by: Brandi Pierik and Matthew Pierik - Red Deer and Calgary Mortgage Brokers

Home prices may be astronomical in certain parts of the country, but historically low mortgage rates are allowing borrowers to pay off their mortgages faster than ever.

At today's average rates, 61% of a new homebuyer's very first mortgage payment is going towards principal repayment, according to data from Edge Realty Analytics.

In the early 2000s, that percentage was 26.5%. The change is even more drastic when looking back at the 1990s, where just 11.9% of a homebuyer's first payment went towards paying down the principal, or the 1980s, when that percentage was a minuscule 4.6%.

The result is a much faster build-up of equity over a short period of time, so long as interest rates remain low.

After the first five years of mortgage payments, today's homebuyers borrowing at today's prevailing rates will have paid back more than a fifth of their mortgage (16.5%).

Have questions about your Red Deer mortgage options, or your mortgage in general? Answers are just a call or email away! Contact Brandi Pierik or Matthew Pierik of Dominion Lending Centres for your best Red Deer Mortgage Rates.

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