The Bank of Canada raised its overnight lending rate yesterday by 1% in what looks like a big effort to try and get ahead of inflation. All of the major banks and lenders in turn followed by increasing their prime rates by 1% as well.
For most borrowers on a variable rate mortgage this means your payment will increase on your next scheduled payment as it has been this year.
If you are with a lender that has not changed your payment as the prime rate has changed this may change at some point in the near future. They will have a trigger rate or a point at which they will reset your payment to maintain the existing amortization and/or will ask you to pay the mortgage down or convert it to a fixed rate. You may want to contact them to find out at what point this happens if they have not contacted you already.
If you are wondering whether or not now is the time to lock in and you are in a variable rate mortgage you can contact your lender and see what fixed rate/payment they can offer you at this time. You can then give me a call at 604-556-3893 or email at alex.kotai@ymscanada.ca and we can discuss your personal situation to see what makes sense.
For more information on our mortgage products and your preferred Abbotsford Mortgage Broker please visit our website at www.ymscanada.ca.