What Happens When the Bank of Canada Raises Rates?
With all of the recent speculation in the news about interest rate increases and what the Bank of Canada will do to combat inflation, I thought it would be interesting to point out what happens when rates do increase. Thankfully I found someone else who had already done the work for me!
The following table illustrates just what happens when variable rates go up by .25%.
It’s based on the current average variable rate of 5.15%, amortized over 25 years. If rates increase by .25%:
| Mortgage Amount | Payment Increase |
| $100,000 | $590.17 to 604.58 = $14.41 |
| $200,000 | $1180.35 to 1209.17= $28.82 |
| $300,000 | $1770.52 to 1813.75= $43.23 |
| $400,000 | $2360.69 to 2418.33= $57.64 |
| $500,000 | $2950.87 to 3022.92= $72.05 |
| $600,000 | $3541.04 to 3627.5= $86.46 |
Hat tip goes out to Canadianmortgagetrends.com. Original article can be found here.
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OWN. GROW. PROTECT. First Foundation is the one-stop-shop for financially responsible Canadians looking to get great advice and save money. Whether arranging financing for a property you OWN, or looking…
OWN. GROW. PROTECT. First Foundation is the one-stop-shop for financially responsible Canadians looking to get great advice and save money. Whether arranging financing for a property you OWN, or looking…