Trigger Rate
For a variable-rate mortgage, this is the rate at which the static payment no longer covers the interest portion of a mortgage payment. This means that your mortgage payment is not paying down any principal, and the principal balance of your mortgage can increase. You may not be required to do anything if your Trigger Rate is reached but your lender will likely contact you to discuss solutions. It may be advisable to increase your mortgage payment so you can continue to amortize your mortgage and avoid potentially reaching the Trigger Point.
About The Author
Don Scott
Don Scott is the founder of a challenger mortgage brokerage that is focused on improving access to mortgages. We can eliminate traditional biases and market restrictions through the use of technology to deliver a mortgage experience focused on the customer. Frankly, getting a mortgage doesn't have to be stressful.
Related Posts
