Mortgage Handbook

Repayment Mortgages

The terms of a repayment mortgage allow borrowers to build up equity in their real estate holdings by covering the cost of interest and paying down the principle with each monthly payment.

Borrowers usually receive quarterly or annual statements showing the balance of their mortgage, and how much it has decreased as a result of recent payments.

Repayment mortgages are usually amortized over a set period of time, which can range from from five to thirty years. After this time, the borrower will own 100% equity in their property, provided that they haven't taken out any other loans against its value.