Effect of new interest rate on variable-rate-mortgage between payments?
Building a financial analysis tool for client. On a variable rate loan, when a new interest rate takes effect, does it cause the interest accrual [rate the balance creates interest] to be recalculated between payments
I’m interested in whether it changes the rate at which interest is accrued between payments. Or is the interest rate only allowed to change the accrual rate after the next payment?
My question is particular to Canadian Mortgages, but feedback with respect to any similar financial instrument is helpful.