Will my mortgage repayment increase with the RBA rate hike?

Most homeowners with variable mortgages are unlikely to see their repayments increase, especially if they have been paying extra on their loans, as their direct debits may not automatically adjust.

How do mortgage offset accounts affect rate changes?

Offset accounts can help homeowners manage their cashflow by reducing the visible impact of interest rate changes on their day-to-day budgets.

Where can I get help if I'm struggling with mortgage payments?

If you are struggling to cope with mortgage payments and rising household bills, consider seeking advice from financial counselling services or the free national debt helpline.

Home / Business and Economy / Homeowners Brace for Rate Hikes, But Few Will See Payments Rise

Homeowners Brace for Rate Hikes, But Few Will See Payments Rise

2 Feb

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Summary

Most homeowners won't see repayment increases from Reserve Bank rate hikes.
Many borrowers pay extra, blunting the impact of rate changes on budgets.
Financial advice and helplines are available for those struggling with bills.

Homeowners Brace for Rate Hikes, But Few Will See Payments Rise

A significant majority of Australia's 3.3 million mortgaged homeowners are expected to avoid an increase in their monthly repayments, even if the Reserve Bank of Australia (RBA) lifts its cash rate target on Tuesday. Financial markets and many economists predict a rise from 3.6% to 3.85%, which would mark a notably brief and shallow rate-hiking cycle.

This resilience stems from the fact that many homeowners have been proactively paying more than the minimum on their variable-rate loans. As a result, their direct debit payments have not adjusted to previous rate cuts. This financial buffer means that a future rate hike will not automatically increase their immediate outgoing payments, though it will affect the overall loan payoff timeline.