Canadian Mortgage Borrowers Extend Repayment Periods as Interest Rates Surge

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The Canadian 10-year interest rate has reached a new 52-week high, driven by a recent surge in inflation. In response to this economic climate, the Royal Bank of Canada, the nation’s largest mortgage lender, has disclosed concerning data about its residential mortgages. As of July, a significant 43% of these mortgages had an extended amortization period of more than 25 years.

This marks a notable increase from the previous year when it stood at 40%. In comparison, back in January 2022, this figure was only at 26%. These statistics highlight a concerning trend in the Canadian housing market, where borrowers are seeking longer repayment terms, potentially indicating increased financial stress or challenges in affording shorter-term mortgages.

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