No?
Paying down a high interest mortgage will always have bigger impact on the dollar than paying down a low interest mortgage.
Paying down a high interest mortgage will always have bigger impact on the dollar than paying down a low interest mortgage.
I’m comparing a mortgage with a high rate and lower principal to one with a lower rate and high principal, where the minimum monthly payments are the same and the owner pays the minimum.
A high interest mortgage just means that you pay more total interest over the life of the mortgage. In any case traditional mortgages are front-loaded, so you pay more towards interest up front than you do principal.
An optional extra payment is worth more when interest rates are higher.
Ie. An optional extra payment of 1000$ will pay your 150$ a year in saved interest when the rate is 15% and only 15$ when the rate is 1.5%.
Everything else being equal, optional payments has a higher value, which represent value to the buyer.