South Korean households would face an estimated 6.5 trillion won ($4.9 billion) in additional annual interest costs if lending rates rise by 0.5 percentage points, based on Bank of Korea estimates using household loan balances at the end of the first quarter. High-income households would account for 4.2 trillion won, while middle-income households would face 1.6 trillion won and low-income households 700 billion won. The combined burden for middle- and low-income households would be 2.3 trillion won. The estimate rises to 13.1 trillion won for a 1-percentage-point increase and 26.1 trillion won for a 2-percentage-point increase. Mortgage borrowers with an average balance of 161.93 million won would pay about 810,000 won more annually under the 0.5-percentage-point scenario. The Bank of Korea raised its benchmark rate from 2.50% to 2.75% in July and to 3.00% in August, but mortgage lending continued to accelerate as Seoul-area housing transactions recovered, pushing outstanding bank mortgage loans to a record 952.5 trillion won. The central bank has warned that higher market rates could increase volatility and default risks in vulnerable sectors, while lawmaker Han Chang-min called for debt restructuring and financial support.