How can I test a home loan payment if rates rise in Australia?

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Accepted Answer

How much you can borrow depends on your income, your other commitments, your deposit and other savings, and your credit report. Moneysmart says the amount a lender will lend is not always an amount that will feel comfortable. To leave some room, calculate the repayment if the interest rate rose by 2 percent. That calculation is a way to look at the payment. It is not a pass or fail test. Pre-approval asks for evidence of your finances and lasts 3 to 6 months. It shows what you may be able to borrow. It does not guarantee the loan. The lender still assesses you and the home before a final yes.