What Does the RBA Rates Increase mean for your Home Loan

The big four didn't wait long. On Tuesday last week the Reserve Bank raised the cash rate to 4.60%, and within 24 hours Commonwealth Bank, Westpac, NAB and ANZ had all announced they would lift their variable home loan rates by the full 0.25% p.a. For most variable-rate borrowers with these banks, the new rate applies from Friday 9 October 2026.

If your home loan is on a variable rate, that's the date to mark in your calendar. At Thatcher Finance, we've put together a quick guide to which lenders have confirmed the increase, when it kicks in, how much extra you're likely to pay, and the steps worth taking in the days before it arrives.

WHEN DOES MY RATE CHANGE?

Borrowers with any of the big four, Bankwest or Bank of Melbourne will see their variable rate increase on Friday 9 October 2026. Several mutual banks are moving a day sooner, on 8 October. If your lender isn't one of these, expect an announcement soon. Most lenders pass on a change within a few weeks of an RBA decision.

Keep in mind that your interest rate and your repayment amount may not change on the same day. Bankwest, for instance, has said it will notify principal-and-interest customers before adjusting their minimum repayment, while interest-only repayments will adjust automatically from the effective date. Plenty of lenders take a similar approach, so depending on when your repayments fall due, the higher amount might not appear until a few days or even weeks after 9 October. Once the change takes effect, log into your banking app or contact your lender to confirm your new minimum repayment.

HOW MUCH MORE WILL I BE PAYING?

On a 30-year principal-and-interest loan, a 0.25% increase works out to roughly an extra $82 a month on a $500,000 loan, around $164 a month on a $1,000,000 loan, and about $329 a month on a $2,000,000 loan.

WHAT CAN I DO BEFORE OCTOBER 9?

As of October 9 the new rates apply. Here's where we suggest different borrowers focus their attention:

Owner-occupiers on a variable rate:

Make sure your budget has room for the higher repayment. It's also worth comparing your current rate against what lenders are offering new customers, as the difference may be larger than the 0.25% increase itself. A refinancing review with Thatcher Finance can help you see whether switching could recover some or all of the extra cost.

Buyers holding pre-approval:

Lenders test your borrowing capacity using a buffer above the actual interest rate, which means a rate rise can shrink the amount you're approved for. Before you make an offer, get in touch for a pre-approval.

Loans yet to settle:

If you're still waiting on settlement, check with us or your lender which rate will apply on settlement day and whether you can lock in a rate.

First home buyers:

Double-check your eligibility for government schemes and the relevant price caps.

Investors:

Take another look at your holding costs and how your lending is structured (or talk to us!), and talk to your accountant about the tax implications relevant for each state.

Fixed-rate borrowers:

Your repayments stay the same until your fixed period ends. If that's due within the next six months, start weighing up your options now so you don't simply roll onto your lender's preferred rate.

The Thatcher Finance Perspective

With the big banks lifting rates on the same day, a large number of households will feel the change at once on 9 October. What you're paying now isn't necessarily the best rate you could be getting. Thatcher Finance compares a wide range of bank, non-bank and specialist lenders on behalf of clients across Australia. Contact us ASAP to find out how your loan compares in the industry. We’ve negotiated favourable lending solutions for many of our clients and we’re always here to help.