The Bank of Canada announced its 6th rate hike of the year this morning in an attempt to reach its target inflation rate of 2%. Prime rate now sits at 5.95% for most banks.
In September, the inflation rate was recorded as 6.9%, causing prices of food and other necessary costs to increase. The Bank of Canada states that by increasing interest rates, demand should slow relieving price pressures.
However, these hikes are causing some Canadian’s mortgage payments to increase by hundreds or even thousands of dollars causing protests to start across the country.
Fixed-rate mortgages are not affected by this specific change today as the bond market priced in this recent increase this past week. For new purchases or refinances, the qualifying rate has gone up decreasing the amount of mortgage home purchasers will qualify for moving forward.
With yet another increase of 0.50%, you can expect your monthly payments to increase by approx. $26 per $100,000 on most variable rate mortgages and/or lines of credit, with the exception if you have a fixed payment, then the amortization increases.
Watch the video below for a segment we did on Global News this morning.
Angela Calla also did a segment with CBC News for deeper information on this market change and trigger rates. Check out the video below.
Read the Bank of Canada statement here.
Times are stressful, but we’re here to help guide you through these market changes and ease recovery. Get in touch with us at callateam@countoncalla.ca so our team can evaluate your financial situation and provide you with unbiased advice!
Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.
Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.
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