Situation: I bought a house with my dad. After a downpayment of 100k, the mortgage is around $420 000 at roughly 2035$ a month on a 5 year term, 30 years on a variable rate, paper signed and moved in on July 2022 when the fixed rate was around 7%. All has been good so far: payments are given in time and all. But I have been looking the variable rate climbing up to 6,5% lately

Long story short, my broker calls me to say that the monthly payment is not enough anymore to cover the interest let alone the principle and wants to work out a way later this week to figure this out. I’m thinking an increase in monthly payments.

Here’s the thing, I am not a 100% understanding the full situation

1- Is this cause for concern? Im an LPN roughly bringing in $40000 after deductions and my dad making $35000 as cashier (not including overtime)

2- What should I expect in this meeting, what can I do to minimize the increase in monthly payment.

3- Anyone else in the same situation? What’s your plan?

4- Did eat breakfast this morning?

Edit: I looked in with my broker, the fixed rate was 5% when it was offered and not 7%. We chose variable because at the time it was near 3,5%.

Update: After talking with the bank, I have decided to go with the option where I continue to pay both interest and principal which comes to $2775 a month, yikes!

It’s be the best option compared to the tempting $2130 a month which would only cover the interest and no principal for the 5 year term, which would mean I’d be paying out of ass when my term ends.