Hey homeowners! Every time the Bank of Canada (BoC) makes a rate announcement, you probably hear a lot of buzz about mortgage rates. But what does it actually mean for you? Let’s break it down so you can stay ahead of the game!
Why Does the Bank of Canada Change Interest Rates?
The BoC adjusts its key interest rate to control inflation and keep the economy stable. If inflation is too high, they raise rates to cool things down. If the economy is struggling, they lower rates to encourage borrowing and spending.
How Does This Affect Your Mortgage?
Variable-Rate Mortgage Holders: Your mortgage rate is directly tied to the BoC’s rate. When rates go up, so do your payments. When they drop, you save money!
Fixed-Rate Mortgage Holders: Your rate is locked in, so BoC decisions won’t affect you immediately. However, if you’re renewing soon, today’s rates will determine your new payment.
New Homebuyers & Refinancers: BoC rate changes impact what lenders offer, so timing your mortgage application can make a big difference in what you’ll pay.
What Should You Do When Rates Change?
If rates are rising: Consider locking in a fixed rate or reviewing your budget to prepare for higher payments.
If rates are falling: A variable rate might offer savings, and it could be a great time to refinance.
If you're renewing soon: Start shopping early and explore your options with a mortgage broker (like me!) to secure the best deal.
Let’s Create a Mortgage Game Plan!
Navigating rate changes can be tricky, but you don’t have to do it alone. I’ll help you make the best choice based on your unique situation.
Let’s Talk!
Whether you're buying, renewing, or refinancing, I’ll make sure you have a strategy that works for you—no stress, just results! Reach out today and let’s get started.
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