Bank of Canada Increases Interest Rate

Bank of Canada Increases Interest Rate

Earlier this morning, Bank of Canada has announced interest rate increase from 0.50% to 0.75%. Consequently, the major banks will follow the interest rate hike and increase their prime rate.

The current prime is at 2.70% for most lenders (TD is at 2.85%), it’s very likely for them to set the prime to 2.95%, an increase by 25 basis points.

As a borrower, if you have variable rate with variable payment, you shall receive a letter/communication from your mortgage lender to notify you the interest rate/payment change in coming weeks.

For a $400K mortgage, the 0.25% interest hike means $50 (approximate) increase for monthly mortgage payment.  

If you would like to know whether it’s a good time to convert to fixed rate, please contact us by email or telephone.