Some of the top rated home loans for February 2025

As of February 2025, Australia's major banks expect the Reserve Bank of Australia (RBA) to cut the national cash rate at its upcoming meeting. If lenders pass on this anticipated rate cut, borrowers can look forward to more affordable mortgage repayments.

While the timing and scale of cuts remain uncertain, the big four banks have forecast multiple rate reductions over 2025 and 2026. CBA and Westpac both expect the next cash rate cut in February 2025, with the rate falling to 3.35% by December 2025. NAB also predicts a February 2025 cut, forecasting the rate to drop to 3.10% by February 2026. Meanwhile, ANZ expects the next cut by February 2025, with the rate declining to 3.85% by August 2025.

What can homeowners do now?

With rate cuts on the horizon, you may be anticipating more breathing room in your budget as mortgage repayments become more affordable. However, instead of waiting for interest rates to drop, you can take proactive steps to reduce your mortgage costs now:

• Review your mortgage: Regularly check if your home loan is still competitive and aligned with your financial goals.
• Contact your lender: If you think you’re paying more as a loyal customer, consider contacting your lender. Some lenders may offer a lower rate to retain customers, particularly if they have a strong repayment history.
• Consider refinancing: Switching to a lower-rate home loan could help reduce monthly repayments or improve cash flow, but keep in mind the potential repayment costs.

What to consider before refinancing your home loan

Homeowners may consider refinancing for various reasons, with a lower interest rate being one of them. However, choosing the right mortgage involves more than just the interest rate.

While a potential rate cut could provide relief, it’s essential to assess the overall cost and benefits of a loan. Factors such as fees, loan features, and repayment flexibility can have a lasting impact on your financial health and should be carefully considered before making a decision.

RateCity’s Real Time Ratings™ can help you quickly compare the options available to you by combining their cost and flexibility into a single star rating. These ratings are updated frequently, and the top-rated choices are ranked on RateCity’s Home Loan Leaderboards. Some of the top-rated mortgage deals in different categories may also be eligible for a RateCity Gold Award.