Last Updated: 12th April, 2023

The Reserve Bank of Australia (RBA) says that two-thirds of outstanding fixed-rate home loans are expiring in 2023. This suggests that many borrowers will need to make decisions regarding their home loans in the next few months.

What Happens When My Fixed-Rate Term Ends?

Banks can start charging you more in different ways when your fixed rate expires. You may not even realise that you’re paying more than necessary.
  • If you decide not to refix your loan, banks usually give you a revert rate, which is typically higher than the fixed rate you were paying.
  • If you refix, you may not get the special offers the bank gives out to new fixed-rate borrowers.
  • If you choose to refinance, you can potentially get a better deal by shopping around for a lower interest rate.
Your lender will usually inform you in advance about the end of your fixed-rate term and any necessary changes to your repayment schedule. This is the time to review your options and look for a better deal with the help of an expert. Making an informed decision is crucial, to ensure that your next move is a wise one.

How Will My Repayments Increase Once My Fixed-Term Ends?

This table compares repayment amounts for fixed-rate loans with various terms between December 2021 and March 2023. The fixed rates used for December 2021 were obtained from RateCity, while the current rates are taken from Home Loan Experts’ lowest available fixed rates as of 16 March 2023. It should be noted that the rates in the table are intended for owner-occupiers who pay their principal and interest monthly and have a loan term of 30 years.
Dec 2021 March 2023 Difference Difference in repayment on $500,000 home loan
1 year fixed 2.38% 5.39% +3.01% $860
2 years fixed 2.45% 5.49% +3.04% $873
3 years fixed 2.87% 5.44% +2.57% $747
Thousands of borrowers will face a massive hike in monthly repayments when their fixed rates expire this year. It is important to note that interest rates are predicted to rise again and borrowers may face even higher rates when they refix or move onto a variable rate. As a result, their repayment amounts may increase beyond the figures mentioned in the table. The figures above were calculated using Home Loan Experts’ Home Loan Repayment calculator. You can use it to calculate your monthly repayments with different loan sizes, interest rates, loan terms and repayment options.

How To Get The Best Deal When Your Fixed-Rate Term Expires

When your fixed term ends, you can look for a few options: