Mortgage borrowers have proved resilient against the interest rate risk of their loans

Abstract

The majority of housing loans in Finland are variable rate loans, where borrowers carry the risk that interest rates will rise. The ability of borrowers to service their debt is currently eased by the decline in interest rates and by the interest rate hedging products taken earlier. Mortgage borrowers have proved to be resilient, coping well with their loan servicing costs even during the period of steep rises in interest rates. Borrowers should ensure they have sufficient buffers for future financial risks too. This article makes use of data from the Positive Credit Register for the first time. The Register was launched in Finland in spring 2024.