Rate rise to hurt many
HUNDREDS of thousands of home loan customers will be pushed to the brink if interest rates rise and won’t cope with larger repayments, alarming research has revealed.
Financial services firm Canstar quizzed more than 700 Australian borrowers and found about one in five existing mortgage customers (17 per cent) would not be able to afford one rate rise of 25 basis points when it happens.
This would add about $45 per month to repayments on a standard $300,000 30-year home loan. Based on ABS data, this means about 485,000 households would be struggling to make ends meet if they were hit by an interest rate hike.