The Canada Mortgage and Housing Corporation indicates in its latest report on the residential mortgage sector that 1.2 million mortgage loans are due for renewal in 2025 and that 85% of them have been signed while the rate of the Bank of Canada was 1% or less.
Borrowers who need to renew their loans next year will face lower interest rates than many have seen this year, with the Bank of Canada having already lowered its benchmark rate four times to 3.75%. today, and more discounts are expected to come.
Higher interest rates at renewal this year helped push the delinquency rate to 0.19% in the second quarter, up from a record low of 0.14% in 2022, but CMHC says it remains well below the pre-pandemic rate of 0.28%.
Although delinquency rates remain low for banks and credit unions, they increased at mortgage investment trusts to surpass pre-pandemic levels after reaching 1.15% in the first quarter.
The rise came as alternative lenders also saw mortgage debt growth faster than the broader market in the second quarter.
This report by The Canadian Press was first published November 4, 2024.
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Last modification: November 4, 2024