A mortgage assessment rate is the interest rate a lender uses to test whether you could afford repayments if rates increase. It is a serviceability test, rather than the rate necessarily charged on your loan.
How the buffer works
APRA’s current mortgage serviceability buffer for banks is at least 3 percentage points above the loan’s interest rate. For example, a loan priced at 6% would generally be tested at no less than 9%, and a lender may also apply a minimum assessment-rate floor. A 3-percentage-point buffer is different from increasing the quoted rate by 3% of its value.
What it means for borrowing
Lenders also assess income, living expenses, existing debts, dependants, deposit and other eligibility criteria. Policies can differ, particularly for lenders outside APRA’s banking framework. Passing a serviceability test does not guarantee approval. Compare repayments at the offered rate and higher rates before choosing your budget.
Official sources
- www.apra.gov.au — Apra maintains current macroprudential policy settings highly uncertain
- moneysmart.gov.au — Choosing a home loan
Identified factual guidance updated 3 October 2026.
