Common homeowners in Canada believe that they will be free from their mortgages only when they are 57 years old - an additional two years compared to what they anticipated in 2012.
According to a recent survey by Canadian Imperial Bank of Commerce (CIBC), debts from various cards, including credit cards, have gone up, hindering the homeowners' capability to settle their mortgages sooner.
In an e-mail sent by CIBC executive vice-president (mortgage, insurance, lending and deposit products), Colette Delaney said that they suggest that the Canadians look into their comprehensive finances and work to first repay their other loans to lessen the burden of interest costs. According to Delaney, it is unlikely that people having an increasing number of loans, which are not related to mortgage, would be initiating additional measures to repay their mortgages, which may result in a longer repayment period.
Last year, just 11% of homeowners, who had taken extra loans after they bought a home, could make additional imbursements on their mortgages, while 19% of homeowners who did not take any additional loan after buying their home could make a one-time payment.
The CIBC survey report also discovered that people living in British Columbia believe that they will be around 59 years when they are able to repay their mortgage in full, while homeowners in Saskatchewan and Manitoba would be able to do so when they are 58 - among the oldest in the country! In other places, the expected age of being mortgage-free is 57.
According to Ms. Delaney, keeping a mortgage for an extended period would actually translate into fewer savings for the retirement period. She said that if people are able to be mortgage-free rapidly, it may assist in increasing their savings for retirement. On the other hand, holding the mortgage for a longer period, till people are in their 50s, will mean that they will face more challenges in achieving their long-term goals regarding savings.
Leger Marketing conducted the survey online and interviewed as many as 1,503 adult mortgage holders in Canada between the period February 19 and 25. According to the Marketing Research and Intelligence Association, the professional body of the polling industry in Canada, online surveys normally are without any error margin, as they do not select their subjects randomly.