Many Canadians are concerned how they will be able to pay for their expenses, especially a mortgage, in light of rising costs and interest rates. In fact, according to IG Wealth Management’s 2023 Financial Confidence Index, which measures and reports on Canadians’ overall financial confidence, 62% of Canadians predict that housing affordability would worsen in 2024 and 46% anticipate that mortgage rates will increase in the upcoming year.
Both homeowners and potential buyers are faced with new obstacles as the economy changes and mortgage rates start to rise. Those navigating the real estate market are feeling anxious and uneasy due to the recent increasing trend in mortgage rates. Notwithstanding these modifications, homeowners and prospective purchasers can utilize preemptive tactics to manage the escalating mortgage interest rates.
Consider extending your amortization period
You have the option to make your regular payments more bearable by extending the amortization term of your mortgage, which is the amount of time it takes to pay off your mortgage in full. Taking longer could result in smaller payments and greater financial flexibility.
Take advantage of contract renewals
Take advantage of the fact that your mortgage is up for renewal by thinking about making a lump sum payment and comparing fixed- and variable-rate mortgages. To set realistic expectations and ensure you have enough time to consider your alternatives, organize a meeting with your financial advisor at least three months before your planned renewal date.
Include your mortgage in your full financial picture
Many people don’t include your mortgage payment in their larger financial plan because they see it as a “siloed” expense. However, it’s crucial that mortgage payments are constantly taken into account when analyzing your entire financial situation because they’re frequently their single biggest outlay. It will be easier to manage your responsibilities if you work with a financial advisor that is knowledgeable about every aspect of your finances, not just your mortgage.
Many people don’t include your mortgage payment in their larger financial plan because they see it as a “siloed” expense. However, it’s crucial that mortgage payments are constantly taken into account when analyzing your entire financial situation because they’re frequently their single biggest outlay. It will be easier to manage your responsibilities if you work with a financial advisor that is knowledgeable about every aspect of your finances, not just your mortgage.
Learn more mortgage rate advices at https://newscanada.com/en/Rising-mortgage-rates–3-strategies-that-could-help-137802
Reference: https://newscanada.com/
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