Millions of Canadian homeowners will face significant increases in their mortgage payments when their loans renew in 2025. Rising interest rates and high living costs are causing anxiety among homeowners who secured low rates during the pandemic. Many are exploring options like extending amortization periods and switching to monthly payments to manage the increased costs.
Canada could see a wave of mortgage renewals in 2025. Here is how some homeowners plan to navigate the payment shock.“We have no idea how we will afford an increase.”
“How do you survive? It’s not feasible. Food’s too expensive. Insurance is too expensive. They’re bleeding us dry. Like, what do you get, 40 per cent out of your pocket now?” The mortgage delinquency rate across the country grew to 0.192 per cent in the second quarter of 2024 , up from 0.188 per cent in the first quarter. In 2022, the rate reached a record low of 0.14 per cent.
However, a tidal wave of mortgage defaults and home foreclosures is unlikely, Bourassa-Ochoa underscored. Moreover, in their own report, the CIBC predicted that overall, mortgage payment “shock” will be felt at a micro level, instead of macro.For the more than a million homeowners renewing their mortgage this year, getting the lowest rate on offer will be top of mind.
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