Trigger Point

For a variable-rate mortgage, the Trigger Point will be reached if the outstanding principal balance (including any capitalized interest) is higher than the original principal balance of your mortgage. If this happens, your bank will contact you to discuss possible solutions. The most likely solutions will be either 1) you make a lump sum payment of principal to bring your mortgage balance back below the original balance, 2) you increase your monthly payment amount to pay down principal according to your original amortization schedule, or 3) you convert your mortgage to a fixed ate mortgage.