As interest rates on variable rate mortgage products increase, the payments do not change. There will be a point where the principal and interest payments can no longer cover the interest charged on the mortgage.
This happens when your rate has exceeded the Trigger Rate, otherwise reflecting an INTEREST ONLY payment with additional interest owed if your variable rate increases BEYOND that Trigger Rate.
Because there is no further principal being paid down, the amortization remains “forever”.
To offset any payment shock, it’s recommended you increase your monthly payment to cover the outstanding interest given you surpass your Trigger Rate.
At renewal, the remaining original amortization period, say 25 years after a 5 year term of an original 30 year amortization is used to calculate the new terms payment amount. This is when the ‘reset’ happens on the payment.