What is a mortgage stress test?
A check of whether you could still afford repayments if interest rates rose. Lenders add a buffer to today's rate and see if the higher repayment still fits your budget.
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Mortgage Stress Test Calculator
Lender-style stress test — recomputes the monthly repayment at a higher buffered rate and checks whether it still fits within a chosen share of your income.
stressed rate = current + buffer ; check stressed repayment vs income limit
Frequently asked questions
Why add a buffer?
Because rates change over a loan's life. Testing at a higher rate guards against being caught out if borrowing costs climb after you buy.
How is the repayment calculated?
Using the standard amortising mortgage formula, which blends interest and principal into a level monthly payment over the term. The test recomputes it at the buffered rate.
What is the income limit?
A ceiling on what share of your income should go to the mortgage, often around a third. The test passes if the stressed repayment stays under that limit.
What if I fail the test?
Consider a smaller loan, a bigger deposit, a longer term, or waiting. Failing the buffer is a warning that a rate rise could stretch you uncomfortably.