CTV Morning Live: Mortgage Minute- October 16, 2018
What to do when mortgage rates increase?
With the Bank of Canada announcement set for next week, what does that mean for variable mortgage and credit holders?
When the Bank of Canada increases their interest rates, the banks and lenders will follow suit and raise their prime interest rates. Although the discount that was secured at the time of obtaining the mortgage does not change, the calculation against the prime rates (increases or decreases) will change the amount of the payment with the majority of lenders.
If prime rates increase by 0.25%, this reflects a change in payment of about $21 per $100,000 of mortgage. With the increases over the past year, some variable rate mortgage holders may be looking for some options for stability in their payments going forward. If you are feeling anxious about another potential increase, variable rate mortgages do come with the ability to lock into a fixed interest rate at anytime in the term.
If you want to discuss your personal situation, contact your Mortgage Broker for advice.
Mortgage maturing within the 6-12 months? This is a great time to connect with your Mortgage Broker to discuss locking in a rate and your options.
To watch the full segment from CTV Morning Live- Mortgage Minute, click here.