Rate hike to squeeze homeowners, put pressure on house prices — via financialpost
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“Every $100,000 in mortgage balance will see an increase of approximately $14 per month due to the 0.25 per cent hike,” Alex Leduc, chief executive of mortgage website MyPerch.io, said of those with adjustable-rate mortgages.While this may not seem like a substantial amount, it comes amid high inflation and after a series of interest rate hikes over the past 18 months have already taken a bite out of household budgets.
“As borrowers hit their trigger rate, their amortization will reset upon renewal, leading to higher monthly payments,” Leduc said. “For instance, an average borrower with a $500,000 mortgage can expect an increase of $1,000 to $1,150 in their monthly payments. For every $100,000 in mortgage balance, we estimate that payments will increase by $225 per month, assuming a two per cent original mortgage rate.
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