Question 1

How much does a 0.25% rate rise cost?

Accepted Answer

On a $500,000 loan over 25 years at 6.2%, a 0.25% rise adds approximately $80/month or $960/year to your repayments. The impact scales with your loan size — on a $800,000 loan, the same rise costs about $128/month.

Question 2

Should I stress test my mortgage?

Accepted Answer

Yes. Financial planners recommend ensuring you can afford repayments if rates rise 2-3% above your current rate. Banks also stress-test your application at a higher rate. If the stress test shows unaffordable repayments, consider building a buffer or fixing a portion.

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