Mortgage Blog

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Bank of Canada Announcement - January 22nd, 2020

January 22, 2020 | Posted by: Barb Pinsent - Trusted Fort McMurray Mortgage Associate

Today the Bank of Canada announced that they have maintained the overnight rate. This is the first of many announcements this year about potential interest rate changes that could impact your current and future borrowing plans. My New Year’s Resolution is to help ensure that the impact of any interest rate changes to you is minimal. I am here to provide you with strategies to ensure more of your hard-earned cash stays in YOUR pockets and doesn’t line someone else’s!  

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate.  

The outlook isn’t looking as rosy for the Canadian or Global economy as we previously expected, so even though there was a few rate increases in 2018 it is predicted that rates will remain fairly steady for the next few months. 

With the holiday season over and December credit card bills rolling in, now might be a great time to set your New Years Resolution to consolidate debt and perhaps reduce spending! It is an unfortunate reality that Canadians are suffering from mountains of debt. In a survey recently conducted by Manulife Bank, as many as 40% of Canadians say they are living beyond their means and only 12% of respondents noted that their income was increasing faster than their debt! So what are your options? Where do you go from here? Are you paying off your credit cards every month? Or are they piling and piling and piling? Let me share some ways that you can overcome this debt struggle: 

Start with a Budget. 
The number one tool to reducing debt is to be strict with a budget. We live in a society of #FOMO (Fear of Missing Out) and #YOLO (You Only Live Once), but the reality is this mindset is not helping your debt reality. Set your budget, be realistic and live within your means. 

Prioritizing Debt Repayment. 
Sometimes when our debt mountain seems insurmountable, you can't even imagine where to start or figure out how to work your way out it. Creating a plan and getting advice from professionals like myself can make the debt load more realistic to tackle.

Work to grow your emergency fund. 
Even if you are in a good circumstance and financial situation, it is often the unexpected that throws everything off kilter. When we don't have that back up nest egg and are forced to borrow money to pay for unexpected costs or life changes it can really set us back. 

Consider consolidation. 
Have a consultation discussion with your mortgage professional to decide if consolidating your debt into your mortgage makes sense for you and your family. Since your mortgage interest rates are much lower than credit card rates and other unsecured rates, this might be a great option to help you get on top of that debt mountain. You just need to be disciplined not to go right back to acquiring more debt! It is about changing your habits as well.   

If you are concerned about your debt load and want more advice and support please do not hesitate to reach out to me at 780.370.1490. 

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