Mulling mortgages as rates rise Rising interest rates and a cooling housing market can make the mortgage arithmetic confusing for homebuyers and investors alike. Global News spoke to a few real estate investors this week to break down variable rates, fixed rates and options to keep payments predictable even as interest rates rise. Fixed rates are the traditional option for consistency, letting homeowners lock in to a single interest rate for the length of their term. Variable rates, which fluctuate with the central bank’s policy rate, grew in popularity over the pandemic as rock-bottom rates from the Bank of Canada allowed many buyers to get into the market. But did you know about “static” payments, which offer a hybrid model? These mortgage options allow you to keep the same monthly payment even on a variable model, with more of your payment going towards the interest than the principal and extending the length of your loan. Some investors who spoke to Global News swear by the “certainty” of static payments. But those same experts advise homeowners to do their own research and figure out their own risk tolerance before signing on the dotted line. Find out what you should know before taking on a mortgage in this Global News story.  How to ‘control your narrative’ after a layoff Former employees of Shopify, Hootsuite, Wealthsimple and more are picking themselves up and dusting themselves off after a series of layoffs at some of the biggest names in Canadian tech. A layoff can be “professionally traumatic,” said Mike Shekhtman, regional director at employment consultancy Robert Half, which makes it important to “pause” and resettle your emotions in the wake of a sudden termination. Though ex-Shopify employee Heather Aleinik says she was devastated to lose her role as a team lead at the e-commerce giant last month, one of her first steps post-layoff was to launch a Slack channel for her former colleagues to gather and share job leads and tips to navigate the waters of unemployment. Experts who spoke to Global News said leaning on your network and taking the time to reassess what you really want in your career can pay dividends down the line, and turn a layoff from a curse into a blessing. "You can control the narrative from this part," Aleinik says. Read more from Global News reporter Craig Lord.  Telus floats 1.5% credit card charge Telus customers might want to check their bills come October, if a proposed surcharge is approved by the Canadian Radio-television and Telecommunications Commission (CRTC). The extra 1.5-per-cent charge, which Telus says would amount to roughly $2 for the average customer, would apply to anyone using a credit card to pay their bill. Telus would be cleared to levy the fee as of Oct. 6 after a class action settlement from Mastercard and Visa, which will allow merchants to pass on credit card surcharges to customers. But it needs the CRTC’s approval to add the charge under its terms of service. Telus says the fee will not apply in Quebec or to customers of its Koodo subsidiary. Read more in this Global News post. ________________________ – THE QUESTION – “I'm a homeowner who recently came into a windfall of cash. I still have two years left on a decent fixed mortgage rate and 18 years left on the full term. My question is: am I better off using this influx to pay off more of the mortgage in an accelerated payment, or should I invest it and stick to my payment schedule? Or just blow it on a nice vacation haha. Thanks!” — A Money123 reader “Great question. Why not do all three? The accelerated payment just means that, aggregately over the year, you’re paying one full month of extra payment, which goes directly to pay off your mortgage. For example, let’s say your payments *should* be $2,000 per month but you’re paying bi-weekly. The easy way to get to your bi-weekly payment would be to multiply your payments by 12 months, and then divide by 26 bi-weekly payments ($2,000 x 12 months = $24,000 per year payment => $24,000 / 26 bi-weekly payments = $923.08). If you’re accelerating your payments, you would add an additional month over the year to your payments (A total of $26,000 on the year divided by 26 payments of $2,000 each). That’s an extra $76.92 bi-weekly, bringing your new accelerated payments to $1,000, even. This is not a huge increase, but one that will help you pay off your mortgage faster. Second, investing part of your money might be a fantastic idea. I don’t know how much of a windfall you received specifically, but it’s always good to put money away for the future. If the amount of money makes you feel uncomfortable and you have questions on where to invest it, talking to an independent financial planner would be your next best action. Third, treat yourself! Depending on how much money you received, you could treat yourself to a spa day, or even an all inclusive vacation. Just remember that many lottery winners go broke because they get used to spending their winnings and end up spending more than they have. If you do decide to take a vacation, set a budget and cost limit so that the windfall of cash doesn’t become a burden.“ -Eitan Pinsky, mortgage expert and owner, Pinsky Mortgages ___________________________ Want your money question answered by an expert? Get in touch! | 
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