Recession: Should I Panic About My Mortgage (or Not)?

During a recession, the first worry is often your job. If your income drops, mortgage payments can feel heavier. But you have options! This is where a good cushion (not the sofa kind—a financial cushion!) or a line of credit can make all the difference.

And if you start to feel the squeeze, let’s talk. It’s better to review your loan, refinance, or adjust your strategy while there’s still time. The goal is to have a solid plan B.

When the economy slows, people hesitate to buy or sell. The result? Fewer showings, fewer offers, and homes that take a little longer to sell.

But here’s the upside: less competition = more negotiating power for buyers. And if you’ve had your eye on a property for a while, it might be the right time to act… calmly and strategically.

During a recession, banks get a bit cautious. They want to make sure you can really pay. Expect a closer look at your file—proof of income, ratios, credit score, etc.

The good news? A broker (like me!) can open doors to lenders you might not even know. We’re talking about a network of around 20 institutions, with flexible solutions—even when banks say no.

Interestingly, mortgage rates can drop during a recession. Why? Because the Bank of Canada wants to stimulate the economy, so it cuts its key rate. Variable rates usually follow, and often fixed rates do too.

But watch out! Rates can move quickly, especially fixed rates influenced by the bond markets. So, it’s not the time to nap if you’re thinking about buying or refinancing.

Note: For a personalized strategy, it’s essential to work with your mortgage broker and financial advisor, as every situation is unique and must be handled on a case-by-case basis.
Note 2: If you don’t have a financial planner, financial advisor, or insurance advisor, give us a call — we know the best!