Key Takeaway

Mortgage interest rates across Australia fell again today, continuing a downward trend that began following the Reserve Bank of Australia’s recent commentary on inflation easing. Variable rates from major lenders have dropped by 5 to 15 basis points, while one-year and two-year fixed rates have declined by 10 to 20 basis points. This presents an opportunity for existing borrowers to consider refinancing and for prospective buyers to lock in lower rates.

What’s Happening With Rates Today

Australian mortgage rates are moving lower across both variable and fixed products. According to the Reserve Bank of Australia, the RBA cash rate remains steady at its current level, but market pricing on future rate movements has shifted following recent economic data showing inflation moderating toward the RBA’s target band.

Major lenders including the big four banks have reduced advertised variable rates by between 5 and 15 basis points (0.05 to 0.15 percentage points) today. Fixed-rate products, particularly one-year and two-year terms, have seen more pronounced cuts of 10 to 20 basis points. Three-year and longer fixed terms have shown smaller movements as they incorporate different market expectations.

These rate reductions come after several lenders made similar cuts over the past fortnight, responding to shifts in wholesale funding costs and competitive pressure in the refinancing market.

What This Means for Borrowers

If you currently hold a variable-rate home loan, your rate may automatically decrease if your lender has reduced its standard variable rate, though this depends on your specific product and whether you hold a discounted package rate. Check with your lender directly to confirm whether today’s movements apply to your loan.

For borrowers on fixed rates approaching expiry, today’s lower variable and fixed rates create a decision point. Compare what your loan will revert to against current refinancing offers. According to ASIC MoneySmart, refinancing can save thousands over the life of a loan if you secure a better rate, though you should account for discharge fees, application fees, and any break costs if you are still within a fixed term.

First-home buyers and property purchasers benefit from today’s rate drop through improved serviceability. Lower rates mean your income can support a larger loan amount under lender serviceability tests, though deposit requirements, loan-to-value ratio limits, and lenders mortgage insurance (LMI) thresholds remain unchanged.

Read also: Mortgage and Refinance Interest Rates in Australia: Will Rates Rise or Fall This Week?

Check the Comparison Rate

Advertised rates differ from the comparison rate, which includes most fees and charges over a standard loan term. The comparison rate provides a more complete picture of a loan’s true cost. When comparing products, always review the comparison rate alongside the advertised interest rate, and verify current terms directly with a licensed lender or mortgage broker before making a decision, as rates change frequently.

What to Do Next

If you are considering refinancing, gather recent offers from at least three lenders or work with a licensed mortgage broker to compare products suited to your loan-to-value ratio and financial position. If you are purchasing, confirm pre-approval quickly, as rates can move between pre-approval and settlement.

Remember that rates, fees, eligibility criteria, and loan features vary significantly by lender and product. Always obtain personalised advice from a licensed mortgage broker or lender for your specific circumstances.

General Advice Warning: The information in this article is general in nature only and does not consider your objectives, financial situation, or needs. You should consider obtaining personal advice from a licensed mortgage broker or financial professional before acting on any information presented here. This article does not constitute personalised financial, lending, or legal advice. Mortgage rates, fees, and eligibility criteria change frequently; verify current offers with a licensed lender or broker before making any decisions.