If mortgage interest rates rise, how much will your monthly payments change? A 30 million yen, 35-year projection table

If you have a variable-rate mortgage, are you wondering, “If interest rates go up, how much will my monthly payments increase?”

In conclusion, for a 30 million yen loan over 35 years, if the interest rate rises by 1 percentage point, your monthly payment will increase by approximately 15,000 yen (this is an estimate).

However, in reality, many variable-rate mortgages have a mechanism where “the payment amount does not change immediately.”

In this article, we will organize the relationship between interest rates and monthly payments using a projection table. We will also explain when payment amounts change and the “unpaid interest” you should be aware of.

Please note that this article does not recommend any specific product or borrowing method. It also does not make any definitive predictions about future interest rates.

What you will learn in this article

1. Projections of monthly payments by interest rate (30 million yen loan, 35 years)

2. When payment amounts change (5-year rule and 125% rule)

3. How to view payment amounts by separating “principal” and “interest”

1. If interest rates change, how much will monthly payments change?

First, let’s calculate based on a 30 million yen loan, a 35-year repayment period, and equal principal and interest repayment (where the monthly payment amount is constant). We assume no bonus payments.

Also, these are the monthly payment amounts assuming the interest rate remains unchanged from start to finish.

■ 30 million yen loan, 35 years, monthly payment (projection)
・0.5% interest: approx. 77,876 yen (approx. 6,810 yen less than 1.0%)
・1.0% interest: approx. 84,686 yen
・1.5% interest: approx. 91,855 yen (approx. 7,169 yen more)
・2.0% interest: approx. 99,379 yen (approx. 14,693 yen more)
・3.0% interest: approx. 115,455 yen (approx. 30,769 yen more)

If the interest rate rises from 1.0% to 2.0%, the monthly payment is calculated to increase by approximately 4,898 yen. Monthly payments generally increase by around 15,000 yen per percentage point.

If your loan amount is different, you can think of it as being roughly proportional. For every 10 million yen borrowed, if the interest rate rises from 1.0% to 2.0%, the monthly payment is calculated to increase by approximately 4,898 yen.

I have also included an image of the table in the article.

2. When payment amounts change: The “5-year rule” and “125% rule”

The question here is, “If interest rates rise, will my payments increase immediately?”

According to the Japanese Bankers Association, variable-rate mortgages generally operate under the following mechanism.

– Interest rates are typically reviewed every six months. – Monthly payments for principal and interest repayment are typically reviewed every five years.

In other words, even if interest rates rise, the repayment amount only changes at the next review interval. This is what is known as the “5-year rule.”

Furthermore, even during the 5-year review, there is a cap on how much the repayment amount can increase. It is limited to a 25% increase over the previous repayment amount. This is the “125% rule.”

For example, if you are paying 80,000 yen per month, the cap from the 6th year onwards will be 100,000 yen per month.

However, these are standard or general mechanisms. The existence of these rules and their specific conditions vary depending on the lender and the contract. Please be sure to check your own contract and the explanations provided by your lender.

3. Looking through an accounting lens: Separating repayments into “principal” and “interest”

The monthly repayment amount is the sum of “principal” and “interest.”

From an accounting perspective, these two are distinct items.

– Principal: The portion that repays the borrowed money itself (reduces debt) – Interest: The portion paid as the cost of borrowing (becomes an expense)

When interest rates rise, even if the total repayment amount remains the same, the proportion of interest increases, making it harder to reduce the principal.

■ Loan of 30 million yen
– 35 years
– Breakdown of the first month (estimate)
– 1.0% interest rate: 25,000 yen interest + 59,686 yen principal
– 2.0% interest rate: 50,000 yen interest + 49,379 yen principal
– 3.0% interest rate: 75,000 yen interest + 40,455 yen principal

As interest rates rise, the amount allocated to principal within the same monthly payment decreases.

Also, if the interest rate were to remain constant, the total interest paid over 35 years would be as follows (estimate):

– 1.0% interest rate: approx. 5.57 million yen
– 2.0% interest rate: approx. 11.74 million yen
– 3.0% interest rate: approx. 18.49 million yen

In addition to the monthly repayment amount, it is also important to keep track of “how much the principal is decreasing” in your household budget.

4. How will the repayment amount change under the 5-year rule (estimate)?

Let’s look at a concrete estimate.

Suppose you borrow 30 million yen at a 1.0% interest rate over 35 years. The monthly repayment amount is 84,686 yen.

The balance after 5 years will be approximately 26.33 million yen (with 30 years remaining). At this point, we will estimate the revised repayment amount if the interest rate has changed.

■ Revised repayment amount if the interest rate changes after 5 years (estimate)
– 2.0% interest rate: 97,319 yen calculated (within the 105,857 yen cap)
– 3.0% interest rate: 111,006 yen calculated → capped at approx. 105,857 yen
– 4.0% interest rate: 125,701 yen calculated → capped at approx. 105,857 yen
– 5.0% interest rate: 141,342 yen calculated → capped at approx. 105,857 yen

The upper limit of 105,857 yen is 1.25 times 84,686 yen.

A point to note here is the case where the interest rate is 5.0%.

The interest for the first month is approximately 109,706 yen. This exceeds the upper limit of 105,857 yen. The difference of approximately 3,849 yen is interest that cannot be covered by the repayment amount. This is what is known as “unpaid interest.”

The Japanese Bankers Association explains unpaid interest as follows:

・If the repayment amount is entirely consumed by interest payments, the principal does not decrease, and the loan balance remains unchanged. ・Unless paid separately from regular repayments, unpaid interest may accumulate in subsequent months. ・The method of settlement varies depending on the financial institution.

Also, even during the 5-year fixed period, if interest rates rise significantly, interest may exceed the repayment amount. In this simulation, for a balance immediately after borrowing, this happens when the annual interest rate exceeds approximately 3.4%.

Of course, this is an extreme example. This simulation assumes that interest rates rise from 1.0% to 5.0%. I do not know what will happen to interest rates in the future either.

The purpose is to see in advance, through numbers, “what happens if rates rise to a certain level.”

I have also attached an image of the table.

5. Things to check

By checking the following points regarding your own mortgage, you will be able to think calmly when you become concerned about interest rate movements.

1. Current loan balance and remaining repayment period

2. Current interest rate and the timing of interest rate reviews

3. Timing of repayment amount reviews (presence or absence of the 5-year rule)

4. Rules for the upper limit of repayment amounts (presence or absence of the 125% rule)

5. Settlement method when unpaid interest occurs

These can be confirmed in your contract, the repayment schedule from your lender, or by making an inquiry.

Please consult your lender or a professional for individual decisions such as reviewing repayment amounts or refinancing.

Summary | Even if interest rates rise, the repayment amount only changes at the time of review

・For a 30 million yen loan over 35 years, if the interest rate rises by 1% (e.g., from 1.0% to 2.0%), the monthly payment will increase by approximately 15,000 yen (estimate).
・Variable interest rates are typically reviewed every six months, and repayment amounts are reviewed every five years (Japanese Bankers Association).
・Even with the five-year review, the increase in the repayment amount is typically capped at 25% (the 125% rule).
・If interest rates rise significantly, interest may exceed the repayment amount, resulting in unpaid interest.
・By looking at the repayment amount divided into “principal” and “interest,” you can see whether the principal is decreasing.

Market views on the outlook for interest rates are divided. I cannot make a definitive statement either.

That is precisely why I believe it is important to check the numbers in advance for “what if interest rates rise.”

Verified information and disclaimer

・Verification date: October 11, 2026 ・Source: Japanese Bankers Association, “What is unpaid interest on a variable-rate mortgage?” and “Repay with variable or fixed? Mortgage interest rate types” (neither page lists an update date). ・The calculation assumes a 30 million yen loan, a 35-year repayment period, equal principal and interest repayment, and no bonus payments. The interest rates are figures used as examples and do not indicate current interest rate levels. ・This article explains the mechanisms. It does not recommend any specific product, borrowing method, or refinancing. ・Interest rates and contract terms vary depending on the lender. Please consult your lender or a professional for individual decisions.