This is a storm without a doubt, but the big questions are "when will this storm pass?" and "how big is this storm going to get?". The Bank of Canada has said in no unclear words that they will continue to raise rates (regardless of the economic pain it causes) until inflation is brought back down to target levels. 

The Bank of Canada is aggressively trying to cool off inflation using the only tool they have at their disposal right now: continuous and significant interest rate hikes. As Benjamin Tal told us at the Mortgage Professionals Canada conference last week: "... given the option of recession or inflation, they will take the recession any day".

While some of the indicators they/we watch (CPI, for one) seem to be going in the right direction, but not drastically enough and haven't been heading in that direction for long enough for them to back off their rate hikes right now. So this means we're probably going to see another 0.75% rate hike up to 6.20% on Wednesday, their next meeting date, and probably another increase when they meet again in December. Some say it will be a 0.25% increase at that time, others think more, but it will depend on the information that comes in between now and then.

I've had more conversations with clients over the last couple of weeks who are nervous about where rates are going, that their budget could get stretched too far. I can understand the stress and anxiety increasing mortgage payments cause, which can far outweigh the question of "will rates come back down eventually and will I kick myself for locking in now?". 

You need to do what's right for you and your family, and that can change regularly. You may feel that things are fine until they don't feel fine anymore. That is understandable and normal. Changing your mind based on new information, or even a new feeling about information you already had, is healthy and normal. 

If you want to lock into a fixed interest rate with your current lender, there are no requalifying questions required, just reach out to your current lender and sign the paper they provide when you request it. If you don't know who your current lender is, reach out to us and we'd be happy to provide that information.

If you want to lock into a fixed rate and want to see if you could get a better offer from another lender, get a quote from your current lender, then reach out to us and we'd be happy to compare that to what is on the market from other lenders.

To everyone: if you can, I recommend increasing your monthly/bi-weekly mortgage payments by 20% to reduce increased payment shock down the line. This has the added benefit of paying down your mortgage principal by every extra dollar, so it's a win-win if you can afford it on a monthly basis.

I am here weathering the storm with you, so please reach out when you have questions or concerns.