This could rise to 65% of homeowners if the central bank hikes its key lending rate by half a percentage point at its December meeting From m_zadikian
The Bank of Canada said half of all homeowners with a variable rate, fixed payment mortgage had reached their trigger rate by Oct. 2022.
The note also warned that number could rise to 65 per cent of homeowners if the central bank hikes its key lending rate by half a percentage point at its upcoming December meeting, as many Bay Street economists expect. Once a homeowner hits their trigger rate, they're typically given several options by the lender, including paying a lump sum towards the loan to bring the principal down, increasing their monthly payment to cover the entire interest portion, or extending the amortization period.
Separately on Tuesday, Bank of Canada senior deputy governor Carolyn Rogers said in a speech that the central bank was monitoring"One group of Canadians who will be finding this adjustment painful are those who recently purchased a home, potentially stretching their budget to do so, and who chose a variable-rate mortgage," Rogers said.
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