There has been a lot of talk surrounding rising interest rates in Canada since the increase yesterday. This along with the debate on whether or not there really is a real estate bubble (and that it’s about to burst) can cause a lot of stress. Before you start panicking, this is how the interest rate increase will impact you.
I Have A Variable Mortgage
Okay, take a deep breath, if you have a variable mortgage you will feel this rate hike right away. The good news, for most people, is that this increase won’t make that much of a difference to your overall budget. If you want to find out exactly how much this is going to impact you, check out this handy mortgage rate increase calculator by clicking here.
I Have A Fixed Rate Mortgage
The good news is that this rate increase isn’t going to impact you until it’s time to renew your mortgage. For those who are getting close to the end of their mortgage renewal date, it’s probably prudent to make an appointment with a mortgage broker (we can help!) to ensure you get the best possible rate when the time comes.
I Need To Negotiate A Mortgage For A Home Purchase
With the rate increase in place, now more than ever is the best possible time to work with a mortgage broker (contact us). They can tell you exactly how these changes will impact your budget and will be able to secure you the best rate available.
I Have A Home Equity Line Of Credit
If this loan is variable, which many are, this will impact your loan (meaning you’ll owe more), if not your fixed rate will remain the same until the end of the term.
I Have A Car Loan
Most car loans are for a fixed rate, so most existing loans should remain the same as long as they’re fixed, however the increase means that anyone securing a new car loan is going to end up with a higher interest rate overall.
What About My Credit Cards?
Most credit cards have fixed rates, so your rate remains the same. If you are unsure, contact your bank today to confirm.
I Have A Line Of Credit
Lines of credit are directly linked to a bank’s prime rate, so borrowers will feel the impact of the rate increase.
What About My Savings?
Historical data trends towards an increase in interest earned on savings accounts, so there may be a little more money in your savings account as a result of the recent rate hike. Enjoy this silver lining!