What is APRA Serviceability Buffer?

Australian lenders generally assess repayment capacity using an interest rate above the actual product rate. This assessment margin is often called a serviceability buffer.

The purpose is to test resilience if rates rise. Actual assessment methods vary by lender policy, product type, and regulatory settings over time.

Borrowing estimates can change materially when the assessed rate rises, even if your contract rate remains unchanged.

• Directly affects estimated borrowing capacity outcomes.
• Helps explain why approval limits can feel lower than expected.
• Important when comparing scenarios across rate environments.

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