Homeowners Not Risking

January 14, 2010

The Canadian Association of Accredited Mortgage Professionals has conducted an interesting survey the results of which are showing that home buyers in Canada are quite careful when taking out new mortgages.

The association examined 40,000 loans issued in 2009, and the results reveal that a great majority, 86 percent, of new issued mortgages were fixed-term. That is a pretty safe option, as the borrower stays at the same rate for concrete number of years. Amongst the homeowners with fixed terms, 70 percent took terms of five or more years. "The vast majority of Canadian mortgage borrowers are not taking on undue risks,” Jim Murphy, the president of the association said.

But of course, not all the homeowners are trying to play it safe. About 4,000 households took on maximum debt along with short-term rates, as Will Dunning, the chief economist of the association claims. Those, however, make up only a tiny part of all the owners.

Canadians seem to be very responsible and do not want to risk anything - good for them. It's true that sometimes the risk is worth it, but most of the time, safety is just what one needs.

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