Borrowers chose the following terms in the last year:
Over 5 years: 22% (This stat is surprising since there’s so little evidence that terms of this length are economical over the long-run.)
17% of mortgagors have amortizations over the standard 25 years (same percentage as last year)
36% of mortgages originated in the last year have amortizations over 25 years (versus 46% one year ago)
93% of mortgagors have never missed a payment
4% of mortgagors missed a payment in the last year (There was no link, however, to new home buyers or to 30-40 year amortizations.)
6.8% of mortgagors indicate that they presently have difficulties making payments
In addition, another 8.6% of mortgagors expect that future potential rate increases may “exceed their tolerances” (The study author suggests that many of these individuals have breathing room. That’s because many have large amounts of equity, and/or can expect income increases, and/or have room to decrease payments if needed.)
0.45% of Canadian mortgage holders are 90+ days overdue on their mortgage payments (as of February)
Borrowers got an average discount of 1.46% off posted 5-year fixed rates in the last year.
The average Canadian mortgage rate is now 4.09% (down from 4.83% one year ago)
The rate on mortgages originated in the past six months is 3.63%
Just 1.3% of mortgagors have rates of 8% or more
Future Rate Expectations
70% of Canadians expect mortgage rates to rise
0% expect rates to fall (CAAMP’s data table shows “0%” and says “virtually no one expects interest rates to fall.”)
16% of mortgagors increased their regular payments in the last 12 months
13% made lump-sum pre-payments
5% made both forms of pre-payment (25% made one or both forms in the last 12 months)
Total lump-sum prepayments averaged about 1% of the typical borrower’s mortgage
325,000 mortgagors have rental units in their primary residence generating rent (125,000 needed rental income to qualify for their mortgage).
12% of borrowers locked into a fixed rate from a variable rate in the past 12 months (about 400,000 borrowers)
About This Survey
CAAMP is the national organization representing Canada’s mortgage industry. This survey was conducted on its behalf by Maritz (a major national public opinion and market research firm) for CAAMP, during April 2010. The author is Will Dunning, Chief Economist for CAAMP and founder of Will Dunning Inc. Data used in this report was obtained from various sources, including an online survey that included 1,800 home owners with mortgages. CMT provides this data for commentary purposes and is not affiliated with CAAMP or Will Dunning Inc.
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