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Lenders drop rates as RBA cuts again

Lenders drop rates as RBA cuts again

Find out who is passing on the cut and by how much in RateCity’s live rate cut list

Lenders have already starting slashing variable rates after the RBA took the unprecedented step of cutting the cash rate to 0.75 per cent today.

The Reserve Bank Governor Philip Lowe has cut rates for the third time this year, citing weaker than expected growth in the domestic economy and global uncertainty.

The average home owner could save up to $57 a month and $682 a year if the 0.25 rate cut is passed on in full. This is based on an owner occupier paying principal and interest on a $400,000 loan.

Already, lenders have begun to fire off rate cuts to their variable home loan customers, with Homestar Finance and Athena Home Loans both passing on the full 0.25 per cent.

Reduce Home Loans has slashed its lowest variable rate by 0.20 per cent, but for new customers only. This brings the lowest variable rate in the market down to 2.69 per cent.

Paul Marshall, chief executive at RateCity.com.au, said with rates already so low, some banks will find it hard to pass today’s cut on in full.

“It’s a juggling act between the interests of savers, borrowers and shareholders, especially now interest rates are in unchartered territory,” he said.

“That said, wholesale funding pressures have significantly come down, so some banks will step up and pass on a full cut.

“The RBA may be forced to cut rates again this year particularly if the next inflation figures come in below expectation and the unemployment rate rises further,” he said.

Potential savings if your lender passes on a full 0.25% cut

Loan size

Old Rate

New Rate

Monthly Difference

Annual Difference





















$1 million





Source: RateCity.com.au. Assumes an owner occupier paying principal and interest over 30 years. This scenario is based on a lender passing on the rate cut in full.

Who’s moved?

LIVE UPDATES: https://www.ratecity.com.au/rba-cash-rate.



Date effective (earliest)

New lowest variable rate

Reduce Home Loans


1 October


Homestar Finance


1 October


Athena Home Loans


1 October


Source: RateCity.com.au

Notes: Effective dates may vary for new and existing customers. Lowest rates may only be available for new customers.

How to ensure you get a rate cut

  1. Call your bank and ask them whether they are cutting your rate, by how much and when.
  2. Check what other lenders are offering. Even if your bank is passing on the cut, you might find a better deal from a competitor.
  3. If your bank doesn’t pass on the cut in full, or you discover you’re paying too much, consider switching. The beauty of a variable home loan rate is that you’re well within your right to take your business elsewhere.

How to put a rate cut back into your home loan

  1. Find out if your bank is passing on the rate cut, and by how much.
  2. Work out what your new monthly repayments will be and what this means for your budget.
  3. If you decide to put that money back into your mortgage, call your lender up and ask them to keep your monthly repayments the same.

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This article was reviewed by Head of Public Relations Laine Gordon before it was published as part of RateCity's Fact Check process.



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