Have you been worried about the mortgage rate hikes? As a real estate investor I too share your concern.
Our mortgage is up for renewal in a month and we just received the mortgage renewal papers from a B-lender.
The fixed mortgage rate has been increased from 3.54% to 6.39% – both are one year term fixed rate mortgages.
This will increase our monthly mortgage payments by $686.48, yikes!!! 😨😨😨😨
I was expecting an increase, I just wasn’t expecting the magnitude of the increase. 🤦🏻♀️🤦🏻♀️🤦🏻♀️
We were speaking to a different bank earlier about potentially refinancing the property. We turned down the opportunity to work with them as they couldn’t offer additional funds at refinancing and typically refinancing with a different bank often requires a lot of work from my end.
Now we’re rushing to get back to them because their rates are a lot more reasonable. 🤷🏻♀️🤷🏻♀️🤷🏻♀️
Speaking of mortgages, as most of you are aware, Bank of Canada just announced that their overnight lending rate is increased to 1.5%. They also signaled that they would most likely have another increase soon.
Yep, it sucks.
As real estate investors, we were “notified” well ahead and couldn’t say that we’re blindsided on the rate increase.
Of course, I’m not really the expert when it comes down to interest rates and mortgage financing.
This week, I got to speak to a mortgage broker, Scott Dillingham from LendCity Mortgages on how to best handle this rate hike.
He also discussed why he always tried to qualify for a mortgage with variable rate (and the answer may surprise you)_, how to work with mortgages in a corporation and whether you could find lenders that are willing to work with student rentals…
You can wath my onterview with Scott here where I share these Best Tips for Mortgage Rate Hikes.
Oh, and if you
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Until next time, happy Canadian Real Estate Investing.
Cherry Chan, CPA, CA
Your Real Estate Accountant