Interest rates have risen dramatically over the past year. When your mortgage has a variable interest rate and a fixed payment, you can hit your trigger rate when interest rates rise.
The limit rate is the interest rate from which your mortgage payment will no longer cover the principal and interest due for this period.
Once you have reached the trigger rate, your payment will only cover interest and no amount will be used to repay your principal. This means that you have stopped repaying your loan.
The best way to know your trigger rate is to review your mortgage or loan contract. You can also contact your bank.
She will be able to calculate the exact rate for you. She can also let you know what options are available to you if you reach her.
For example, your bank may offer to extend your amortization.
This is the period during which the mortgage is reduced and eventually paid off in regular payments.
By extending the amortization, you will avoid having to increase the amount of your recurring payments.
However, extending amortization means paying for a longer period and paying more interest in the long run.
If you are considering mortgage relief options, it is important to know the effect on your overall mortgage.
If you’re worried about your mortgage, contact your bank to discuss your options.
You can also seek advice from reputable and trusted sources to explore your financial options.
Contact a financial professional, such as a licensed financial advisor or accredited credit counselor, to discuss a plan.
Do your research to find a reliable organization and a qualified professional.
For more information, visit canada.ca/money. (Source: The News Edition)
2023-05-10 13:35:28
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