Variable rate mortgages with rising payments

In January 2022, the ECB announced a rate hike that had a significant impact on the most noticeable variable rate loans. The average installment of these loans increased by an average of +36% compared to the mid-year lows, with a peak increase of +49% for mortgages disbursed in the last 5 years. CRIF conducted an analysis on the effects of this increase in mortgage rates and found that borrowers faced higher financial exposure despite making 24 installments between January 2022 and December 2023.

The growth in interest rates led to a +25% increase in overall debt levels for those with variable rate mortgages over the last five years. However, insolvency rates did not increase for those with adjustable rate mortgages. Despite this, there was an increase in financial tension among borrowers with variable rate mortgages as indicated by CRIF’s financial tension index, which showed higher levels of indebtedness and risk of failure among these borrowers.

Simone Capecchi, Executive Director of CRIF, commented on the impact of interest rate dynamics on variable rate borrowers in the past two years. While there was no significant increase in insolvency rates, there was a notable rise in financial stress among these borrowers. The potential for a rate cut in June 2024 could provide relief for borrowers and help stabilize their financial situations.

As macroeconomic and geopolitical uncertainties continue to loom over us, it is crucial to remain vigilant and prepared to face any challenges that may arise in the future.

By Samantha Johnson

As a content writer at, I craft engaging and informative articles that aim to captivate readers and provide them with valuable insights. With a background in journalism and a passion for storytelling, I thoroughly enjoy delving into diverse topics, conducting research, and producing compelling content that resonates with our audience. From breaking news pieces to in-depth features, I strive to deliver content that is both accurate and engaging, constantly seeking to bring fresh perspectives to our readers. Collaborating with a talented team of editors and journalists, I am committed to maintaining the high standards of journalism upheld by our publication.

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