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Average Canadian Mortgage Debt: Tips for Managing Increasing Rates

Average Canadian mortgage debtThe average Canadian mortgage debt (according to Equifax) has risen to over $335,000, up by 10% year-over-year. With a recent rise in interest rates by the Bank of Canada, what’s an average Canadian to do? Let’s take a look at some of the challenges homeowners are facing and how to combat them so that you can make smart decisions about your mortgage situation and stay on top of your loan payments.

How to Manage a Large Mortgage Debt

Canadians are facing a perfect storm when it comes to their mortgage debt. On one hand, they have to take on more and more debt every year just to keep up with rising property values. At the same time, interest rates—the key variable in monthly mortgage payments—are beginning to rise again. When you combine these two factors, you see some serious obstacles. Here’s how Canadians can manage their increasing mortgage debt and help lower the average Canadian mortgage debt.

Take an honest look at your current finances.

Make sure you’re not spending too much money each month or overextending yourself financially. Doing so will only make it harder to pay off your mortgage debt. Use a mortgage calculator to help you work out if you can afford a new mortgage while paying off other debts like credit cards, student loans, or car loans.

Refinance your home loan with lower interest rates.

Refinancing your mortgage could reduce the total amount of interest paid over the life of your loan. Be sure to talk to a mortgage professional like HW Advantage for the best advice on this strategy. They can help you find the best rates and fees and make sure you get the most competitive deal possible.

Explore all your options before deciding which type of mortgage is best for you.

There are different types of mortgages available today that may better suit what you need than a standard 30-year fixed-rate plan. Talk to your mortgage broker. They will have all the current information on the options available to you.

Take the Mortgage Stress Test

Are you looking at a new mortgage? Before you take on any mortgage debt, lenders will require that you pass a mortgage stress test to prove you will still be able to afford your home even after an interest rate increase. To get pre-approved, you will need to answer these (and similar) questions. How much do you currently spend on mortgage payments? What is your current interest rate? What is your down payment amount?

What if you’re self-employed? Not to worry. We can help you find a mortgage solution that will work for you. Learn more about the pre-approval process for self-employed individuals here.

HW Advantage – Your Burlington Mortgage Solution

If you’re facing mortgage difficulties and are worried about rising rates, HW Advantage is here to help. As a Burlington-based mortgage broker, we are knowledgeable and up-to-date on all current information about Canadian mortgages. We work hard every day to provide outstanding service to our clients every step of the way. We realize it’s not easy buying a home, but it doesn’t have to be difficult either.

You need a mortgage broker who can help you find and choose from hundreds of mortgage products while negotiating on your behalf with lenders and taking care of the paperwork. Working with an expert is worth it to make sure you get exactly what you’re looking for.

Contact us today at HW Advantage. We’ll help you manage your mortgage debt with a product that suits your budget and lifestyle.

Questions? We’re here to help.

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