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Mortgage News 2022

Where Are Interest Rates Headed?

1/26/2020

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Are interest rates going to remain low?

Likely, yes.

The global economy is still very uncertain. Tariffs, global trade, Brexit, "populism" and slow growth in Canada are all reasons that contribute to today's continuation of low-interest rates.

In its 2020 outlook, the Bank of Canada has reinforced this stance on interest rates with many other economists sharing a similar view.

Although the last Bank of Canada meeting did not lead to any change in the overnight lending rate, there is some speculation that the overnight lending rate will be reduced in 2020. This means that interest on variable rate mortgages will also be reduced.
​
Is a recession coming?

Likely, yes.

The market moves in cycles of both booms and busts. Circumstances contributing to low-interest rates today are not permanent which means consumers need to be cautious about taking out too much debt in low-interest-rate environments.

One of the main problems with having a personal debt level of 177% (StatsCan 2019) is a rise in increasing debt levels due to a low cost of borrowing.

In situations where the Government is forced to keep interest rates low, a later, sudden rise, can trigger payment shock, delinquency, bankruptcy and even foreclosure of real estate.

What should be a borrower's plan in 2020?

Generally, borrowers should always try to be proactive in reducing their cost of borrowing by not overpaying on credit products and minimizing their use.
There are many different ways a borrower can use financial tools to their advantage including debt consolidation through refinancing, balance transfers to low-interest cards, and better budgeting.

It's also important to consider that in times of a recession, property value tends to diminish and to refinance, the property value must be supported.

Try a free debt restructuring analysis for free! Contact me today.
​
Sarah A. Colucci, Mortgage Agent
Mortgage Edge, Broker 10680
Direct: (647) 773-4849
www.coluccimortgages.com

​
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Address

411 Queen St. 
Newmarket, ON
​L3Y 2G9

Sarah A. Colucci, Mortgage Agent Lic. M14000929
Sherwood Mortgage Group
Licence # 12176

Telephone

Direct: 647-773-4849
​
Email: scolucci@sherwoodmortgagegroup.com
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  • Home
  • WHY USE SARAH FOR YOUR NEXT MORTGAGE
  • APPLY ONLINE
  • PRODUCTS
    • Free House Value Tracker Report
    • CASH-BACK MORTGAGE
    • BRIDGE FUNDS
    • REVERSE MORTGAGES
    • SELF-EMPLOYED MORTGAGES
    • FIRST-TIME HOME BUYER PRE-APPROVALS >
      • FIRST-TIME HOME BUYER TAX CREDIT
    • MORTGAGE REFINANCE >
      • Prepayment penalties
    • SPOUSAL BUYOUTS
    • INVESTMENT PROPERTIES AND RENTALS
    • BRUISED CREDIT
    • PRE-APPROVALS
    • NEWCOMERS
    • DEBT CONSOLIDATION
    • HOME EQUITY LINE OF CREDIT
    • PURCHASE PLUS IMPROVEMENT PROGRAM
    • WHY INVEST IN REAL ESTATE
    • MORTGAGE RENEWALS >
      • New Mortgage Rules and Mortgage Renewals
    • SECOND MORTGAGE LOANS
    • LESS THAN 20% PROPERTIES
    • DOWN PAYMENT
  • CONTACT ME
  • PRIME RATE CANADA
  • CLOSING COSTS
  • DOCUMENTS REQUIRED FOR MORTGAGE FINANCING
  • MORTGAGE DICTIONARY
  • MORTGAGE NEWS
  • GOVERNMENT MORTGAGE RULES
  • MORTGAGE TIPS
  • HOUSE HUNTING CHECKLIST
  • APPRAISALS
  • FIXED OR VARIABLE RATE?