Lenders Are Raising Rates After the RBA Rise: What It Means for You

Written by Ferns Finance. Last updated 13 October 2026.

The Reserve Bank of Australia (RBA) raised the cash rate on 29 September 2026, and lenders are now raising the variable rates on existing home loans. New rates are taking effect at different times through the first half of October 2026. If you have a variable loan, your repayment is likely to go up. If you have a fixed loan, it generally will not change until your fixed term ends.

This article covers the step that lands in your bank account after the RBA decision: what your lender does next. At Ferns Finance, we work with homeowners and investors across Logan, Beenleigh and the Gold Coast, and this is a good moment to ask whether your loan is still worth keeping.

Key takeaways

• If your loan is variable, your repayment is likely to go up. Your lender should tell you the new rate and the start date.
• Lenders have announced variable rate rises of around 0.25% p.a. on owner-occupier and investment loans, with effective dates in the first half of October 2026.
• Fixed-rate loans generally do not change until the fixed term ends, so check your expiry date.
• A rise applies to existing customers as well as new ones, which is a good prompt to compare your rate with what is on offer today.

What have lenders done since the RBA decision?

Lenders have started announcing variable rate increases of around 0.25 percentage points. The RBA Monetary Policy Board voted unanimously on 29 September to lift the cash rate to 4.60%, and said it will continue to do what it considers necessary, including increasing the cash rate target further if needed.

Details differ by lender, including the effective date, whether the rise applies to existing and new customers, and how repayment changes are communicated. Principal and interest customers are usually told if their repayment is changing, while interest-only repayments change with the interest charged each month. Fixed-rate customers generally see no change during their fixed term. Check your lender's notice or your online banking to see exactly what applies to you.

Does the rise apply to existing customers or only new borrowers?

It generally applies to existing variable customers too. A rate rise is not only a headline about new loans. If your loan is variable, your lender can change the rate on your existing loan, usually after giving notice.

If you are on a fixed rate, the rate generally stays the same until the fixed term ends. What matters then is what your loan rolls over to, which is often a higher variable rate. Check your fixed expiry date now, not the week it ends.

What can a 0.25 percentage point rise cost me?

Here is an illustrative example, not a real lender rate. Say you have a $750,000 variable loan over 30 years on principal and interest repayments. At 6.50% the repayment is about $4,741 a month. After a 0.25 percentage point rise to 6.75% it is about $4,864. That is roughly $124 more a month, or about $1,488 a year.

It is a modest move on one loan, but it follows three earlier rises this year, and each one stacks on the last. That is why it helps to look at your loan as a whole, not one rise at a time.

Am I paying a loyalty tax?

Lenders often price new loans more sharply than existing ones, so long-standing customers can end up paying more than someone taking out the same loan today. That gap is sometimes called the loyalty tax. A rise makes it easier to spot, because you can compare your new rate with what competitors are advertising right now.

As an illustration, if a new customer could get 6.25% on the same $750,000 loan, the repayment would be about $4,618 a month, compared with about $4,864 at 6.75%. That is a difference of about $247 a month, or roughly $2,959 a year. These are hypothetical figures. Your own comparison needs to be like for like: same loan type, same features such as an offset account or redraw, and the same repayment type.

What if I am an investor?

Investors feel the rise on every variable loan they hold, and each loan reacts differently depending on its rate type, repayment type and fixed expiry. The best approach is to review them one by one: list every loan, mark the fixed expiry and interest-only end dates, and test the cash flow at a higher rate. We can walk through this with you loan by loan.

Should I refinance, or stay put?

The answer comes down to two numbers: how far your rate sits above the market, and what it costs to move. A switch is more likely to pay off if the gap is meaningful, your fixed term is ending, or you want to restructure debt. A small balance or high fees can cancel the saving out.

Before you switch, we look at:

• Break costs. Leaving a fixed rate early can be expensive.
• Discharge and application fees. These count against any saving.
• Equity. If your loan is above 80% of the property's value, you may face Lenders Mortgage Insurance (LMI) or have fewer lender options.
• Features you use. An offset account, redraw or split facility may not come with the new loan.
• Break-even. Divide your total switching costs by your monthly saving to see how long it takes to come out ahead.

Sometimes the best answer is a conversation with your current lender. Some lenders will review your rate if you ask, and some let you switch between their own variable products without a fee. Ask, then compare with the market.

How can I prepare for further rises?

The RBA has said it may raise the cash rate further if needed, so it makes sense to be ready. Test your budget at a rate 1.00 percentage point higher than today. Build a buffer by making extra repayments or using an offset account if you have one. And know your fixed expiry dates, so no rollover catches you out.

Next steps: things you can do this week

1. Find your current rate. Check your app, online banking or latest notice for the new rate, the rate type and the start date.
2. Look for your lender's notice. If your repayment is changing, you should receive a letter or message.
3. Note any fixed expiry dates. A rollover onto a variable rate can cost more than staying fixed.
4. Compare with the market. Use our loan comparison calculator to see where you stand.
5. Stress-test your budget. Run your repayments at 1.00 percentage point higher.
6. Ask us to run the numbers. We can compare options across our lender panel.

Not sure where you stand? Let's talk.

Book a free discovery call and we will walk through your loan together.

Related: our guides to refinancing and investment loans.

Common questions

When will a lender's rate rise start on my existing home loan?

It depends on the lender. Lenders that have announced rises after the RBA's 29 September 2026 decision have set effective dates in the first half of October. Your lender should notify you of the date and any change to your repayment, so check your email, mail and online banking, or ask your lender directly.

Do existing customers get the rate rise or only new borrowers?

Existing variable customers generally get the rise too. Lenders can change the variable rate on an existing loan, usually after giving notice. Fixed-rate customers generally stay on their rate until the fixed term ends. Check your loan contract or ask your lender which rate type you have.

How much extra will I pay on a $750,000 home loan after a 0.25 percentage point rise?

As an illustration, a $750,000 loan over 30 years costs about $4,741 a month at 6.50% and about $4,864 at 6.75%. That is roughly $124 more a month, or about $1,488 a year. These are hypothetical figures, not lender rates. Your repayment depends on your rate and loan terms.

How do I find out what rate my lender is now charging me?

Check your lender's rate change notice, your latest statement, or your online banking or app, where the loan details usually show your current rate. If you cannot find it, call your lender and ask for your current rate, rate type and fixed expiry date, then compare it with the market.

What happens to my repayments if my fixed rate ends soon?

When a fixed term ends, your loan usually rolls to a variable rate, which may be higher than the rate you were on. Your lender should contact you before the end of the fixed term. Check your expiry date and compare options early, so you can choose before the rollover.

Can I ask my lender for a better rate on my existing home loan?

Yes, you can ask. Some lenders will review your rate if you contact them, especially if you tell them you are comparing options. Ask what rate a new customer would get for the same loan, then compare it with the market. A broker can show you what other lenders are offering.

General information only. This article is general educational content and is not financial, tax or legal advice. Speak to a qualified professional about your circumstances.