Rising interest rates are signs of a strong, growing economy, but a rise in interest rates can cost you more to borrow money. When interest rates rise, your loan payments will increase if: you have a variable rate mortgage or you’ll soon need to renew a fixed interest-rate mortgage or loan.
Pay down debt as much as possible to prepare for a rise in interest rates. If you have less debt, you may be able to pay it off much quicker. This will help you avoid financial stress caused by a bigger mortgage payment.
Tips to prepare for a rise in interest rate
- Have lesser expenses so you have more money to pay down your loan
- Pay down the debt with the highest interest rate first
- Consider consolidating debts so you only have one payment to make for multiple loan products
- Find ways to increase your income to help you pay down your loans
- Speak to a broker about your options
It is completely normal to be uncertain when mortgage rates are rising. That’s why we are there to help you through the process and ensure that you are making the best decision for you and your family.
Your Noble Mortgage Broker will guide you step by step, by not only getting to know you personally but your financial goals as well, which will determine which mortgage is most suitable for you. Give us a call today and see how we can help you.