Too much debt could spell disaster

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It looks like the mortgage wars are about to heat up…again. The Bank of Montreal has slashed its 5 year fixed term mortgage rate to 2.79% down from 2.99% It’s good news if you are looking for a break on your mortgage but it could spell disaster for Canadians who are already stretched to the limit.

Money managers say it is crucial for anyone thinking about borrowing more money to make a budget. Build in safeguards in the event of a financial emergency and only borrow what you can truly afford. “Have a good down payment do a budget do it once twice sit down at the kitchen table, be realistic be honest with what you can afford make sure you have that cushion at the end of the day and do the what if analysis.” Christopher Mazur from BDO

But those double digit interest rates are a far cry from today’s rate, which according to some economists may fall even lower.