The Case for Longer Mortgages: Addressing the Mismatch Between Term and Amortization

Partner Michael Feldman has authored an article for the C.D. Howe Institute titled “The Case for Longer Mortgages: Addressing the Mismatch Between Term and Amortization” which explores the mismatch between mortgage terms and amortization.

The piece discusses how to address the mismatch between terms and amortization in order to expand consumer choice, facilitate a private securitization market and reduce government mortgage risk. Below in an excerpt from the article.

As housing debt continues to rise to record levels, however, policymakers fret about taxpayers’ exposure to the housing market. A steady set of changes to mortgage insurance eligibility requirements and the cost of mortgage insurance over the past few years indicates that there is an implicit (and somewhat explicit) policy objective to reduce taxpayer exposure to the housing sector. The question thus arises: does the mismatch between amortization and term hinder policymakers’ ability to control this risk?

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