Most borrowers are resilient. Are you?
The Reserve Bank of Australia's October 2026 Financial Stability Review says most Australian households with mortgages remain well placed to service their debt, although there are pockets of stress. That is a system-wide result, not a personal cash-flow test.
The RBA estimates that around 2% of variable-rate owner-occupier borrowers have a cash-flow shortfall, meaning their income is insufficient to cover scheduled mortgage repayments and essential expenses. A household can therefore sit outside the resilient majority even when the aggregate picture looks stable.
What the RBA finding does — and does not — tell you
The report helps assess risks across the financial system. It does not calculate your actual repayment, living costs, other debts or remaining monthly buffer. Two households with the same loan balance can have very different outcomes because their income, expenses and commitments differ.
The practical question is not whether the average household is coping. It is whether your own after-tax income still leaves room after the mortgage, essential living costs and other fixed obligations are paid.
Calculate the buffer, then test two shocks
Start with monthly after-tax income. Subtract the scheduled mortgage repayment, core living costs and other fixed commitments such as car finance, cards and recurring bills. The amount left is the monthly cash-flow buffer.
Then test at least two realistic shocks: a higher interest rate or repayment, and a temporary fall in income. If the buffer disappears quickly, review discretionary spending, emergency savings, repayment structure and available loan options before pressure becomes urgent.
Use the average as context, not reassurance
BV Finance can help review eligible home-loan structures and repayments using your actual income, liabilities, living costs and lender criteria. Approval, pricing and suitability remain subject to the lender and individual assessment.
Sources and practical tools
General information only. This is not financial advice. Loan options and eligibility depend on your personal income, liabilities, assets and lender assessment criteria.
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