Rising mortgage interest rates have hurt many homeowners over the past year. This is also the case of a family from Quebec, who will have to sell their house given the payments have become too high, reports VAT News.
Within a year, the family saw their payments go from $2,300 to $3,780 per month. These amounts do not include the increase announced Wednesday by the Bank of Canada.
It was in May 2022 that Émilie Cholet bought her house for $565,000 in Quebec. “Our monthly payment was to be $2,300 per month. But there was an increase in the key rate just after we signed. From our first direct debit, we were already around $2,500. And it continued, and continued… When I saw today that the interest rate was still rising, I went to see our accounts, I said: “tabarouette! We are at $3,780 per month!”, she explains to TVA Nouvelles.
Remember that, since January 2022, the Bank of Canada has raised its key rate 9 times. She and her husband have a mortgage with First National, which does not allow the term of the loan to be stretched.
“We trusted our mortgage broker who told us to take a variable rate. We weren’t very keen on it, but we decided to trust him since it’s his job. But we got screwed, eventually. I can tell my bank that it doesn’t work, that we can’t go on like this, that there are five of us at home and that we risk ending up on the street, they are intransigent. They tell me ”we can’t do anything for you”,” laments Ms. Cholet.
She’s not the only one.
“The reality is that several clients with variable rates had 1.45% 2-3 years ago. With Wednesday’s rise, they will be at 5.95%. This is an increase of 4.50% in 15 months! Which economist last year predicted this? None,” said Stéphane Bruyère, mortgage broker with Mortgage Architects, in an interview with TVA Nouvelles.
“If the lady sells her house, she will at least benefit from the fact that her property will have appreciated in value since she bought it. Otherwise, the only way to lower your mortgage payment is to find a fixed rate, but it will be above 5 percent. His monthly payment is still going to be very high, ”he continues.
But the Cholet family must also face the inflation which affects the grocery basket.
“I don’t even dare to go home in the evening, I tell myself the atmosphere is going to be complicated and heavy. We will have to resell, I have no other solution. And we will have to change schools again when my daughter had made new friends. There is also a psychological impact behind all this, ”she explains.
“I don’t understand, what is their purpose? That we all end up in trouble? My husband and I both work full time. We are supposed to live normally. But basically, our house is killing us,” she concludes.
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2023-06-11 23:26:40
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