Mortgage debt hit $1.95 trillion in the fourth quarter of 2025, a 2.6 per cent increase from the previous year, according to the latest market pulse report from Equifax Canada Inc.  

Despite the central bank’s policy interest rate falling from prior peaks to 2.25 per cent and home prices declining in some parts of the country, “it’s still tricky (for) a first-time home buyer trying to purchase your first home,” said Rebecca Oakes, vice-president, advanced analytics at Equifax Canada, who said she is expecting mortgage debt to surpass the $2 trillion mark this year.  

Average new mortgage amounts have continued to rise, hitting $363,778 for all homebuyers (a four per cent increase) and $441,301 for first-time buyers (a five per cent increase).   

Oakes said missed mortgage payments have also been creeping higher, especially in higher-cost provinces like Ontario. “We (are seeing) that knock-on impact of coming off super low rates and the COVID period,” she said.  

Meanwhile, lender switching has soared by 30 to 40 per cent compared with the second half of 2024 due to homeowners seeking more affordable rates amid mortgage renewals.  

Equifax data showed 90+ day mortgage balance delinquency rates jumped 30 per cent year-over-year in the fourth quarter across Canada, rising as much as 54.5 per cent in Ontario.   

Oakes said Equifax is “cautiously optimistic” for 2026 but said headwinds such as large volumes of consumers renewing mortgages this year could potentially worsen credit stress and delinquency rates if interest rates increase again.  

About 1.2 million mortgages are expected to renew at higher rates this year. In July, the Bank of Canada projected the average payment to rise by six per cent, with some borrowers potentially seeing increases between 15 per cent and 20 per cent.  

“Households with outsized leverage, lower incomes or those employed in U.S. export-reliant sectors will remain more vulnerable,” reported credit ratings agency Fitch Ratings on Monday. Fitch Ratings projected mortgage delinquencies to remain fairly stable in 2026, but noted higher mortgage payments could affect delinquencies across other forms of debt, such as credit cards and auto loans.  

Total consumer debt hit $2.65 trillion in the fourth quarter of 2025, a three per cent increase year-over-year, according to Equifax Canada. While mortgage debt accounted for about three-quarters of total consumer debt, missed payments on non-mortgage debt also peaked at the end of December, with 90+ day balance delinquency rising to 1.73 per cent.   

And delinquencies were highest among younger borrowers aged 26 to 35, which Oakes attributed to higher unemployment levels and reduced savings.  

Credit card balances swelled four per cent to reach a record $131 billion in the fourth quarter.   

However, Oakes said that missed payments on credit cards, which typically escalate by about seven per cent in the fourth quarter due to holiday spending, only rose by three per cent.  

“It looks as though consumers have pulled back a little bit in terms of their credit card spending,” she said. “That’s good news.”  

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