Rocket Finds 20% of Higher-Rate Borrowers Make Extra Mortgage Payments as Low-Rate Owners Pay More Often
Updated
Updated · The New York Times · Sep 4
Rocket Finds 20% of Higher-Rate Borrowers Make Extra Mortgage Payments as Low-Rate Owners Pay More Often
3 articles · Updated · The New York Times · Sep 4
Summary
About 20% of borrowers who took out mortgages after rates climbed in 2022 are making extra principal payments, versus a higher share among pandemic-era borrowers with rates just above 3%, Rocket Mortgage found.
Rocket’s review of roughly 3 million home loans from January 2021 to January 2026 said lower-rate homeowners were more likely to pay extra because their smaller monthly bills left more room in household budgets.
Borrowers with higher-rate loans stand to save more by paying down principal early, but bigger housing costs and broader inflation can make payments above the minimum harder to manage.
Among homeowners who do pay extra, the average adds up to about one additional monthly payment a year, a pace Rocket said can save thousands of dollars in interest.