Mortgage rates are climbing for Canadian home owners but experts say that we are very unlikely to have a foreclosure wave like the one that has been taking place in the United States.
Previous mortgage levels were low enough that many Canadians bought into a housing market that they can barely afford now; increased rates have resulted in many home owners paying more than 40% of their monthly income into keeping a roof over their heads Business Laptop Handbags. reducing the amount of money that they can spend on savings Cross Handbags. health Business Laptop Handbags . and nutrition.
What has worked in the past to get more Canadians into home ownership—like low interest rates and small required down payments—has also worked to cause problems for many of those home owners now that interest rates have risen. Our modern perception that everyone should strive for home ownership is also a factor that has pushed people into buying homes that they cannot comfortably afford; but our government may well be changing the way that home buying works in the future.
Finance Minister Jim Flaherty announced this past February that home buyers who are looking to purchase a home and take out a mortgage would need to not only show that they could afford to pay the current rates on a home but also afford a five-year fixed rate mortgage to prove that if prices go up Wallets Handbags . the home owners can still afford those homes. Some business experts like Ian Lee at the Sprott School of Business at Carleton University would like to see the government push even harder to protect our economy against situations like that of the US is currently experiencing. Lee would like to see the minimum down payments for homes increased so that buyers would be required to put down 10% instead of 5% so that home owners were required to have more equity in their homes right away and to make it harder for people to buy homes overall.
With interest rates on the rise Chloe Handbags. home owners should take the time to make up a monthly budget if they dont result in delinquent payments. Even the experts will tell you that an ounce of prevention now Replica Cross Body Bags. is worth a pound of cure later on.