4.60%. That is the RBA cash rate since 30 September 2026, after the fourth rise of the year. Lenders passed the September rise on in full from 8–9 October. Together, the four 2026 rises add about $364 a month to a $600,000 loan with 25 years left (Canstar). As at 19 October 2026, the RBA's next decisions are due on 3 November and 8 December.

Rates differ a lot between lenders. On 19 October 2026 the lowest advertised variable rate on Canstar's database was 5.89%, for loans of no more than 60% of the property's value. Among the big banks, the lowest advertised variable rates on 11 October were 6.34% at CBA, 6.44% at NAB and 6.50% at ANZ (Velofy loan calculator). Some lenders also pay cashback of up to $4,000 to win refinancers. A rate 0.5% lower on a $600,000 loan saves about $195 a month, or about $11,700 over five years if rates stay where they are.

Refinancing is not right for everyone. If your rate is well above what lenders offer new customers and you have not switched in the last few years, it is worth running the numbers.

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Is Now the Right Time to Refinance?

Refinancing makes financial sense when the rate difference between your current loan and the best available rate is at least 0.5% per annum. Below that threshold, fees and time costs often eat the saving. To size that gap in dollars rather than percentage points, the RBA rate change calculator converts any rate move into the change to your monthly repayment.

Three signs it is worth comparing now:

  1. Your rate is above about 6.5%. The average variable rate on existing owner-occupier loans was 6.24% in August 2026 (RBA), before the September rise. With that rise added, it is about 6.5%. The lowest advertised variable rate was 5.89% on 19 October 2026 (Canstar).
  2. You have been with your lender for 3+ years. Lenders often keep their sharpest rates for new customers. Compare your rate with what your own lender advertises to new borrowers.
  3. Your fixed rate is expiring. When a fixed term ends, the loan moves to the lender's revert rate, which is often higher than what the same lender offers new customers. Compare before the fixed term ends.
See how much you could save by refinancing

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What About Fixed Rate Break Costs?

If you are on a fixed rate loan, your lender can charge a break cost — sometimes called an "early repayment adjustment" — when you leave before the term ends. Lenders work it out from the gap between your fixed rate and the current wholesale rate (what it costs the lender to borrow the money) for the rest of your fixed term.

If fixed rates have risen since you locked in, the break cost is often small or nil. If they have fallen, it can be large. Call your lender and ask for a written break cost quote before you apply anywhere else.

💡 ASIC's Moneysmart has a free guide to switching home loans that lists the fees to check before you switch.

Refinance Cashback Offers: October 2026

Offers listed on both Canstar and money.com.au, checked 19 October 2026:

Lender Cashback Minimum Loan Max LVR Ends
IMB Bank $2,000 / $3,000 / $4,000 by loan size $250,000 ($4,000 from $750,000) 80% Until further notice
ME Bank $3,000 $700,000 (refinance) 80% Applications by 28 Feb 2027
Greater Bank $2,500 / $3,000 by loan size $250,000 ($3,000 from $500,000) 80% Until further notice
Newcastle Permanent $2,500 / $3,000 by loan size $250,000 ($3,000 from $500,000) 80% Until further notice

Important: some lenders take back part of the cashback if you leave early. IMB takes back half if the loan is closed within 12 months of settlement. Read the conditions and count them in your break-even calculation, not just the upfront payment. Offers change often, so check the lender's own terms before you apply.

Velofy rate change calculator: a rate 0.5% lower on a $600,000 loan with 25 years left saves <img src=

How to Calculate Your Break-Even Point

The break-even point tells you how many months it takes for your rate saving to outweigh the cost of switching. Here is the formula:

Break-even (months) = Total switching costs ÷ Monthly saving

Example: Jake has a $600,000 loan at 6.5% with 30 years left. He is offered 6.0% at a new lender. Monthly saving: about $195. Switching costs (discharge + application + valuation): $1,200. His cashback: $2,000. He is $800 ahead on the day he switches, plus about $195 a month after that.

Step-by-Step: How to Refinance in Australia

  1. Know your current rate and LVR. Check your latest statement or call your lender. Your LVR (loan-to-value ratio) determines which products you can access — 80% or below opens up the best rates and every cashback offer in the table above.
  2. Compare rates using a reputable aggregator. Canstar, Finder, and Savings.com.au all publish live rate tables. Filter by your LVR and loan size. Look at the comparison rate, not just the advertised rate — it includes fees.
  3. Request a break cost quote from your current lender. Do this before applying anywhere. If you are on a fixed rate, the break cost might be lower than you expect.
  4. Apply to 1–2 lenders maximum. Each application triggers a credit enquiry. Multiple enquiries in a short period can lower your credit score. Choose carefully, then apply.
  5. Provide documentation. Recent payslips (2–3 months), last 2 years tax returns if self-employed, 3 months bank statements, council rates notice, current loan statements.
  6. Settlement. Your new lender coordinates the payout of your old loan and registers the new mortgage. You do not need to do anything — it happens automatically.
💡 Under APRA's rules, your new lender checks you can afford the loan at its rate plus a 3 percentage point buffer. At a 6.0% rate, you will be assessed at 9.0%. Make sure your income comfortably supports this before applying.

Ask Your Current Lender First

Before you sign with a new lender, call your current lender and ask for its retention team (not the regular service line). Tell them you have a better offer and ask them to match it. Some lenders will lower your rate without you switching, which saves the paperwork.

Example: Priya has been with her bank for 8 years on a $520,000 loan at 6.84% with 25 years left. She called the retention team with a competitor quote at 6.29%. Her bank matched it to 6.34%. Her repayment fell by about $163 a month, about $1,950 a year, without a single form.

Model your repayments at a lower rate

Use Velofy's Loan Advisor to see your exact monthly repayment at 6.0%, 6.5%, or any rate — compare P&I vs IO side by side.

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Refinancing Essential · Strategy Guide
The Australian Mortgage & Refinancing Guide

Step-by-step guide to comparing lender rates, calculating break costs, understanding cashback offers, and running the numbers on whether refinancing saves money at your balance.

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Financial Planning · Post-Refinance Budget
Personal Budget & Loan Repayment Tracker

Monthly planner to track your new repayment, redraw balance, and cashback offset — ensures you actually use the rate saving to get ahead rather than lifestyle creep.

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Common Questions

Frequently Asked Questions

Is it worth refinancing in 2026 with rates still rising?

Yes, if your rate is 0.5% or more above what new customers are offered. On a $600,000 loan with 30 years left, a rate 0.5% lower cuts the repayment by about $195 a month, about $2,340 a year; a rate 1% lower saves about $385 a month. On 19 October 2026 the lowest advertised variable rate on Canstar's database was 5.89%, for loans of no more than 60% of the property's value. The average variable rate on existing owner-occupier loans was 6.24% in August 2026, before the September rise (RBA).

What are break costs on fixed rate home loans in Australia?

A break cost is a fee for leaving a fixed rate loan before the fixed term ends. Lenders work it out from the gap between your fixed rate and the current wholesale rate (what it costs the lender to borrow the money) for the rest of your term, applied to your balance. If fixed rates have risen since you fixed, the break cost is often small or nil. If they have fallen, it can be large. Ask your lender for a written quote before deciding.

Which lenders are offering cashback on refinancing in 2026?

As at October 2026: IMB Bank ($2,000 to $4,000 by loan size, with $4,000 from $750,000; half is repayable if the loan is closed within 12 months), ME Bank ($3,000 on refinances of $700,000 or more, for applications until 28 February 2027), and Greater Bank and Newcastle Permanent ($2,500 on loans of $250,000 or more, or $3,000 from $500,000). All require an LVR (loan-to-value ratio) of 80% or below. Offers change often; check the lender before applying. Sources: Canstar and money.com.au, checked 19 October 2026.

How long does refinancing take in Australia?

Refinancing typically takes 4–8 weeks from application to settlement. Digital lenders can be faster, sometimes 2–3 weeks. The process covers application, credit assessment, property valuation, and discharge of your existing mortgage.

What fees are involved in refinancing a home loan?

The usual costs are a discharge fee to close your old loan, an application fee for the new one (many lenders waive it for refinancers), and a break fee if you are on a fixed rate. There are also government fees to register the new mortgage and discharge the old one. If you have less than 20% equity, lenders mortgage insurance can cost more than the rate saving. Add up the costs and compare them with your monthly saving and any cashback.

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