The Bank of Canada raised the interest rate for the first time in seven years.
 
The move put an end to years of "easy money" and debt-fueled purchases of vehicles and homes. It rose from 0.5 per cent to 0.75 per cent, prompting Canada's largest banks to raise their prime rates a quarter percentage point to 2.95 per cent.
 
Prime rates affect the cost of borrowing on floating-rate loans, like variable-rate mortgages, credit lines and student loans.
 
So, how does this all affect mortgages?
 
"Your mortgage rates are going to be higher which means your mortgage payments will be a little bit higher," explained Tawnie Misik, a realtor with Royal LePage Noralta, "to qualify too, you're qualifying at a higher interest rate."
 
If there was a time to buy, it was before July 12; Misik recommends buying now before the rates are raised any more.
 
As the interest rates are raised, the prices of homes will also increase as the market begins to move again.
 
For those with mortgages already, the rate can become a bit murky.
 
"If you have a variable mortgage, you're probably wanting to lock in (your rate)," advised Misik.
 
She added that it would be wise to sit down with a mortgage broker to discuss options that best suit each person.
 
The last time rates were at .75 per cent was 2015.

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