Most years, July 11 is just another day. But in 2018 it could mean a change to the Canadian interest rate.

The Bank of Canada has scheduled its next interest rate announcement for July 11, 2018. This is when they will publicly say if interest rates are going to increase again or not. If they do increase, unsecured debt will be affected. Could you handle a hike?

If you’re not sure, it may be time to think about other options.

One of those options might be mortgage refinancing. If you’re saddled with a lot of high-interest, unsecured debt, such as credit cards, student loans, or other consumer debt, refinancing your first mortgage could give you a lifeline out.

Essentially, a first mortgage refinance would give you money based on equity available in your home. You could then use that money to pay off your outstanding, high-interest debts. You will then be left with a single monthly payment with a significantly lower interest rate.

Even if you’re not struggling with debt, you may be considering refinancing your first mortgage for other reasons – perhaps there’s a home renovation project you’d like to undertake, or you’re planning for a big purchase, or you have a lot of equity available in your home and want to take advantage. Whatever the reason, if you’re considering refinancing, it’s better to do it now than after interest rates increase even further.

Why would you want to refinance before an interest rate change? For one thing, if you’re on a variable-rate mortgage, you may want to lock into a fixed-rate mortgage so your payments won’t fluctuate with the interest rate.

If you’re thinking about refinancing your first mortgage, doing so will get more expensive as interest rates rise, which means you could be saving less over the long run.

Take the following example:

You have a mortgage for $200,000 with Lender A at a 7% interest rate, and you have $20,000 in credit card debt. You find that you can get a mortgage of $220,000 from Lender B with a 5% interest rate. You use the $200,000 to pay off Lender A, and the $20,000 to pay off your credit cards, and then you repay Lender B over the long-term with a lower interest rate.

But if interest rates keep rising, you might not be able to secure as low of an interest rate for your refinancing, which could make the loan harder to pay off.

If mortgage refinancing is on your mind, but you’re not sure if it’s the right move, we can help. DebtCare Canada can assess your situation to determine whether refinancing your first mortgage is a good idea, or if another debt consolidation method would work better.

Don’t wait until July 11. Get in contact today to go over your options.

Call us for a free consultation: 1-888-890-0888.