Fixed rates are falling - should you switch? Some of the top-rated home loans in September 2024

The Reserve Bank of Australia (RBA) has made it clear that it’s unlikely to cut the cash rate any time soon, based on the current data. However, that doesn’t mean banks and mortgage lenders will sit on their hands and wait for the RBA to take action. Instead, they may choose to adjust their interest rates out of cycle from the RBA.

This has been recently seen with some lenders cutting fixed interest rates on selected home loan offers. This includes banks like NAB, Commonwealth Bank, Westpac and its subsidiaries, Macquarie, HSBC, and more. It’s possible these banks are choosing to cut fixed rate offers to better set their pricing in anticipation of future RBA rate cuts in response to gradually moderating inflation.

But this doesn’t mean that Australian mortgage holders should rush to fix their rates. There are still plenty of competitive variable rate home loan offers available on the market for borrowers and refinancers. Because borrowers are locked into a fixed rate deal for between one and five years, their repayments should remain consistent, regardless of future shifts to the cash rate. In contrast, variable rates could rise or fall over time, and may offer improved flexibility compared to some fixed rate deals.

Before applying for a mortgage for the first time or refinancing, it’s important to compare all the available options in the mortgage market and consider which choices may best suit your financial goals and household needs. RateCity’s Real Time Ratings™ can help to make this home loan comparison a little simpler by combining the cost and flexibility of different home loan deals into a single simple star rating. These ratings are regularly updated to help better ensure their accuracy, and the top-rated deals in different categories are ranked on RateCity’s Home Loan Leaderboards, and may become eligible for RateCity Gold Awards.

(Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.)

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