A significant share of consumers are modifying their plans in response
Nearly one in three Canadians (29%) have said that they are unsure how higher interest rates will affect their mortgages, according to a new survey by BNN Bloomberg and RATESDOTCA.
Another 25% said that they are adjusting their plans in response to possible rate hikes.
“Those with variable rates would be impacted in two ways: Either they would have their monthly payments increase if their payments are not fixed, or the amount they pay toward interest monthly would increase while the money going toward principal would decrease,” the survey results indicated.
“Canadians with variable rates were more likely to say that they plan to make a change with their mortgage, which is no surprise given the recent rhetoric around rising rates.”
However, 34% admitted that they aren’t aware of, or don’t fully comprehend, the penalties involved when they break a fixed-rate mortgage – a troubling share considering that fixed-rate offerings account for 71% of those who currently have mortgages or are looking for mortgages.
Twenty-eight per cent (28%) of Canadians said that they currently own their properties without holding mortgages, while 34% said that they own their properties with mortgages. More than half (52%) of those with mortgages said they have household incomes of more than $100,000.