Mortgages in Canada can be a murky subject – one that we hope to shed some light on with a series of highly informational articles.
Latest News
The latest in mortgage news: uninsured posted rates at decade-highs + MORE Mar 11th
Uninsured posted rates from Canada's Big 6 banks have skyrocketed over the past year, according to data from the Bank of Canada..... More »
How Canada’s Mortgage Lenders Adapted to the ‘New Normal’ Dec 14th
The COVID-19 pandemic and the resulting nationwide lockdown forced the country’s mortgage lenders—like many businesses across the country—to adjust their operations in this unprecedented and brave new world of conducting business. They were faced with keeping the country’s mortgage de.... More »
The Latest in Mortgage News: Recent hikes are “painful” for variable-rate mortgage borrowers, says BoC Nov 25th
Homebuyers with a variable mortgage rate are facing a "painful" adjustment as interest rates continue to rise, the Bank of Canada's Senior Deputy Governor Carolyn Rogers said this week..... More »
OSFI considering the need for additional regulations on existing mortgages + MORE Apr 22nd
Canada’s banking regulator says it is considering whether to extend the scope of its mortgage guidelines to include existing mortgages. In its second Annual Risk Outlook released this week, the Office of the Superintendent of Financial Institutions (OSFI) said it will “consider the scope of .... More »
Non-mortgage debt and delinquencies on the rise: Equifax Apr 10th
High interest rates have applied the brakes to Canada's housing market, with mortgage originations down nearly 40% compared to a year earlier..... More »
“Should we refinance our mortgage?”
– moneysense.ca
Q. We’re thinking about breaking our existing home mortgage to take advantage of the low interest rates we’re seeing now, and would appreciate some guidance. This is our scenario:
Mortgage principal: $572,000
Weekly payments: $746.00
Interest rate: 3.78% fixed and locked in until December 2023
Penalty fee for breaking mortgage: $33,000
If we decide to pay the penalty, we could lock into a four-year mortgage at 1.74% fixed, which looks like it would save us approximately $2,500 to $3,000 worth of interest payments.
Mortgage principal: $572,000
Weekly payments: $746.00
Interest rate: 3.78% fixed and locked in until December 2023
Penalty fee for breaking mortgage: $33,000
If we decide to pay the penalty, we could lock into a four-year mortgage at 1.74% fixed, which looks like it would save us approximately $2,500 to $3,000 worth of interest payments.
Here’s where I think it gets interesting. If we decide to continue paying the same weekly amount of $750 that we do now, and put the extra money towards principal, the difference between that at the new weekly mortgage payment of $570 would be $175—giving us $8,400 per year to put directly towards principal. Over four years, that should allow us to reduce our principal by $33,600.
It seems like if we should consider breaking our mortgage to take advantage of the lower rate…
