Almost half of mortgage holders are borrowing more money to pay their home loans because of 10 increases in interest rates, according to the Financial Consumer Agency of Canada (FCA)..“Two-thirds of mortgage holders report having trouble meeting their financial commitments,” said FCA..“The percentage of Canadian mortgage holders who are able to keep up with their financial commitments with no problems has decreased by 22 percentage points since August 2020,” said an FCA report Financial Well-Being of Canadian Homeowners with Mortgages. .“Only 1 in 3 mortgage holders now say they can meet their financial commitments without difficulty.”.“The proportion of mortgage holders who need to draw on their savings due to the economic context has increased by 20 percentage points since August 2020,” said Well-Being. .According to Blacklock’s Reporter, homeowners “increasingly need to borrow to meet their daily expenses.”.Analysts noted of mortgage holders nationwide, more than a third, 35.5%, earn less than $40,000 a year and could not absorb dramatically higher payments. Findings were based on monthly questionnaires with 1,000 Canadians. .The results come from surveys taken before the Bank of Canada raised their rates two times. This increased the loan rate between banks from 4.50% to 5%. This is the highest it's been in 22 years..“An increasing percentage of Canadians are spending more than they earn,” said Well-Being. .“The percentage of mortgage holders doing so is now the highest it has been since the survey began” in 2020..A third of mortgage holders, 32%, said they do not earn enough to meet expenses. The rate was as low as 16% in 2021. Many ran up credit cards, lines of credit and other financing. By official estimate, mortgage debt alone totals $2.1 trillion, with $307 billion borrowed at variable rates subject to Bank of Canada interest hikes..“A growing proportion of renters and homeowners with mortgages are stressed and stress levels of homeowners with mortgages are increasing at a faster rate than that of other groups,” wrote the FCA. .“Stress levels were generally higher for homeowners with a mortgage than for renters.”.The Bank of Canada will talk about interest rates on September 6. The head of the bank, Tiff Macklem, said on July 12 that the rates will stay high until 2024..“It is too early to be talking about interest rate cuts,” said Macklem.
Almost half of mortgage holders are borrowing more money to pay their home loans because of 10 increases in interest rates, according to the Financial Consumer Agency of Canada (FCA)..“Two-thirds of mortgage holders report having trouble meeting their financial commitments,” said FCA..“The percentage of Canadian mortgage holders who are able to keep up with their financial commitments with no problems has decreased by 22 percentage points since August 2020,” said an FCA report Financial Well-Being of Canadian Homeowners with Mortgages. .“Only 1 in 3 mortgage holders now say they can meet their financial commitments without difficulty.”.“The proportion of mortgage holders who need to draw on their savings due to the economic context has increased by 20 percentage points since August 2020,” said Well-Being. .According to Blacklock’s Reporter, homeowners “increasingly need to borrow to meet their daily expenses.”.Analysts noted of mortgage holders nationwide, more than a third, 35.5%, earn less than $40,000 a year and could not absorb dramatically higher payments. Findings were based on monthly questionnaires with 1,000 Canadians. .The results come from surveys taken before the Bank of Canada raised their rates two times. This increased the loan rate between banks from 4.50% to 5%. This is the highest it's been in 22 years..“An increasing percentage of Canadians are spending more than they earn,” said Well-Being. .“The percentage of mortgage holders doing so is now the highest it has been since the survey began” in 2020..A third of mortgage holders, 32%, said they do not earn enough to meet expenses. The rate was as low as 16% in 2021. Many ran up credit cards, lines of credit and other financing. By official estimate, mortgage debt alone totals $2.1 trillion, with $307 billion borrowed at variable rates subject to Bank of Canada interest hikes..“A growing proportion of renters and homeowners with mortgages are stressed and stress levels of homeowners with mortgages are increasing at a faster rate than that of other groups,” wrote the FCA. .“Stress levels were generally higher for homeowners with a mortgage than for renters.”.The Bank of Canada will talk about interest rates on September 6. The head of the bank, Tiff Macklem, said on July 12 that the rates will stay high until 2024..“It is too early to be talking about interest rate cuts,” said Macklem.
