Final answer:
During the first few years of a home mortgage, most of the payments go towards the interest on the loan. However, it is not necessarily better for young people to rent instead of buying a home based on this factor alone.
Step-by-step explanation:
True. During the first few years of a home mortgage, the majority of the monthly payments go towards the interest on the loan. This is because the interest is calculated based on the initial loan amount, which is typically higher at the beginning of the mortgage. As the principal amount decreases over time, the interest portion of the payment decreases as well. This is known as amortization.
However, it is not necessarily better for young people to rent instead of buying a home solely based on the high interest payments during the initial years of a mortgage. There are other factors to consider, such as the potential for building equity and the long-term benefits of owning a property.