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Freddie Mac says more people are paying down their mortgages

More people are paying down their debt, according to Freddie Mac.

More people are paying down their debt, according to Freddie Mac.

If a report released from Freddie Mac is any indication of the housing market, it appears more people are taking advantage of affordable mortgage rates.

According to Freddie Mac, 46 percent of people who refinanced their mortgages last year paid cash on their initial payments. These people are often referred to as "cash-in" borrowers. This marks the highest rate of people opting to pay cash on their refinancing plans since 1985, when Freddie Mac started keeping track of refinancing behaviors.

Experts believe the increase in "cash-in" payments is due to the low mortgage rates in recent months.

"Fourth quarter mortgage rates were at very low levels, the likes of which haven't been seen in more than 50 years," said Frank Nothaft, vice president of Freddie Mac. "This encouraged borrowers who could do so to refinance and many .... chose to pay down a bit of their mortgage at the same time."

In the past, borrowers have often borrowed against their debt, or what's referred to as "cash-out" borrowing. Cash-out borrowers increased last year as well, but only by 5 percent, the lowest recorded level of growth.

Mortgage rates have been on a steady decline in recent weeks, but according to FreeRateUpdate.com, 15-year and 30-year fixed-rate mortgages remained the same this past week, likely due to the uncertainty tied to the political unrest in Egypt.