Toronto homeowner Barbara Edwards has been wondering when she’d see an interest rate hike.
“We wanted to make sure that if one of us lost a job, or was too sick to work, we could still afford to pay for our home on one income,” she says. The pair opted for a 30-year mortgage because they knew they’d have extra expenses in the first year and planned to pay extra toward the principal loan down the road.
It’s impossible to predict where rates will be in two years’ time, he adds. At present, Ratehub’s best interest rate is 4.34 per cent — up almost exactly two per cent compared to 2019’s lows. If interest rates rise by another one per cent over the next two years, the renewal rate would be around 5.24 per cent and the mortgage payment would increase to $4,568 per month. That represents an increase of $1,080 more each month, or an additional $12,960 annually.
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