Posthaste: Some Canadians are regretting their mortgages amid high interest rates
Canadian homeowners are having regrets over their current mortgage as they face unexpected increases in their monthly payments, says one new study.
Over a third of homeowners say they have mortgage regrets and 21.8 per cent say they can’t afford their payments because of consistent interest rate hikes from the Bank of Canada, according to a survey of 1,000 Canadians by The Real Estate and Mortgage Institute of Canada (REMIC), which provides education for licensing of mortgage and life insurance agents in Ontario.
Interest rates have climbed to five per cent since March 2022, fuelling an increase in mortgage rates. That’s left 30.2 per cent of homeowners saying they would have bought a cheaper property had they known rates would climb so much.
“Buying a home is an exciting, emotional and adrenaline filled process,” REMIC chief executive Joe White said in a press release. “Sixty to 90 days after a purchase, the homebuyer’s adrenaline can turn to regret if they’ve overextended themselves and (their home) can become a place that they sleep at and pay off forever.”
Close to half (45.2 per cent) of homeowners think they won’t be able to pay off their mortgage until they are 60. Some think it could take until age 70 (8.2 per cent), 75 (4.6 per cent) or even 80 or more (8.2 per cent) to be mortgage-free.
But people are still putting in the effort to make their mortgage payments, even if they need to cut back on other expenses to do so, White said.
“A home is the last thing that Canadian homeowners would default on because their families need a roof over their heads,” he said. “Everything else suffers, (like) cancelled vacations, high interest from carrying a balance on credit cards and overall quality of life.”
Some homeowners
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