Today the Bank of Canada raised interest rates by a full 1% increase, unlike the .75% increase we were predicting. This if the fourth interest hike this year totaling 2.25% climb to rate and not predicted to be the last.
For some this means a mortgage payment increase of $50 per month, per $100,000 borrowed. For others their payment will remain the same, however their principle to interest portion will change.
Fixed Payment Variable-Rate Mortgages:
Variable rate mortgages with a fixed payment, your payment should stay the same with this rate increase. However you will see a change from the interest to principle portion on your mortgage. A good idea is to increase your payment to ensure you are still paying down your loan and your amortization period will not be affected. You can simply call the bank or give me a call and I can help you get this done.
Adjustable Variable Rate Mortgages: Your payment will increase and will be calculated to match the 1% increase. Having the payment increase with the rate hike will allow you to still be on track with the same amortization schedule.
Fixed-rate mortgage holders:
Your rate and payment will stay the same for the remainder of your term and therefor the increase will not impact you.
Please reach out to Kimberly Walker at 778-828-6186 if you have any questions about how the new increase will affect you!