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Know Your Mortgage Limit

December 30, 2009

Good article last week in the Toronto Star from Tony Wong. Understanding your financial limits (in particular when it comes to your mortgage) is more important than ever. With mortgage rates at historical lows, you don’t want to get caught with a false a sense of security that makes you think you can afford a more expensive home (i.e., with a bigger mortgage). Remember, with interest rates as low as they are today you can get a rate as low as 2% and eventually they will only have one way to go, which is up. So do your homework, understand your financial limits and develop a good mortgage strategy that is right for you. As a start, if you are purchasing your home today ask yourself “can you can afford your home and lifestyle if rates are at 5%?”

Remember, know your limit and spend within it.