Today (July 13, 2022) the Bank of Canada increased the policy interest rate by another 100 basis points to raise its policy interest rate to 2.50 per cent.
Why should it matter to you?
This will lead to Banks and other Lenders increasing their prime rates – and as a result – some people will see an increase in their mortgage premiums.
Will it affect your mortgage?
- Yes, if you have a variable-rate mortgage or a blended mortgage, your payment amounts will increase.
- No, if you have a fixed-rate mortgage.
How much will be the increase?
The increase will depend on the interest rate and other terms of your mortgage as specified in your mortgage agreement.
Should you switch to fixed rate mortgage?
When rates start going up, banks and lenders often ask you to lock-in your rate by choosing a fixed-rate mortgage.
However, the fixed-rate option may not be right for you.
The decision should be taken after reviewing your financial and personal situation such as your job, immediate and long-term plans, financial situation etc.
My suggestion
Don’t rush to sign-up for a fixed-rate mortgage. It may not be right for you.
BEFORE making any changes to your mortgage – talk to a mortgage agent / broker who you trust and get the advice that’s right for you.
Have question or Need advice?
Feel free to Contact Me. No fee, no agreement and no credit check/credit report required for my advice. It’s free, friendly, and confidential. 