CBA, Westpac and ANZ have followed NAB in announcing they will pass on the RBA’s 0.25 cash rate hike in full to their variable borrowers.
CBA and ANZ variable mortgage increases will take effect the same day as NAB’s changes on March 27, while Westpac’s increase will be effective March 31.
As a result, once the new rates take effect, Westpac will offer the lowest advertised variable rate among the big four at 5.74%.
Big four banks’ lowest home loan rates, post March cash rate hike | |||
|---|---|---|---|
Old rate from | New rate from | Effective date | |
CBA | 5.59% | 5.84% | 27 March 2026 |
Westpac | 5.49% | 5.74% | 31 March 2026 |
NAB | 5.94% | 6.19% | 27 March 2026 |
ANZ | 5.75% | 6.00% | 27 March 2026 |
Source: Canstar. Rates are for owner-occupiers paying principal and interest. LVR requirements apply.
What if borrowers can’t meet the new repayment amount?
Those who think they might not be able to afford their mortgage should take the following steps:
- Request a rate review. Even if refinancing isn’t an option, that doesn’t preclude you from asking for a rate cut from your own bank.
- Speak to your bank early: If you can’t meet repayments, contact your bank before missing a repayment to discuss options.
- Seek advice: Get independent financial advice to make sure you’re on the right track.
Banks are required to offer support. Potential options might include:
- Switching to interest-only for a year or two.
- Making reduced payments for a period of time.
- Extending your loan term.
While each of these options can help reduce a customer’s minimum monthly repayments, they can be very costly in the longer term.
For example, switching to interest-only on a $600,000 loan with 25 years remaining could cut repayments by $428 a month, but add up to $30,699 in interest.
Extending the loan term could be more costly, by adding five years, a borrower could save $269 in monthly repayments, but add about $141,956 in interest.
Impact of switching or extending $600,000 loan | ||
|---|---|---|
Change to minimum monthly repayment | Extra cost over life loan | |
Switch to interest-only for 2 years | -$428 | +$30,699 |
Extend loan term by 5 years | -$269 | +$141,956 |
Source: Canstar. Notes: based on an owner-occupier paying principal and interest on the average P&I rate of 5.98%, and an interest-only rate of 6.86% (Canstar estimates of RBA data). Assumes there is one more rate increase as per CBA’s cash rate forecast. Does not factor in extra repayments.
What have the big banks announced for savers?
CBA, NAB and ANZ have not yet announced any increases to their savings accounts.
Westpac has said it will hike the bonus rate on its Life account to an ongoing savings rate of 4.75%, while on its Spend&Save account, available for those aged 18-34, will rise to 5.50%. This is set to be the highest ongoing savings rate on offer post today’s RBA hike.
However, Westpac has failed to apply the hike to the base rates on both accounts, which means savers who don’t meet the monthly conditions will earn just 0.10%.
Westpac savings rate changes, effective 27 March | ||
|---|---|---|
Max rate (if monthly conditions met) | Base rate (if conditions not met) | |
Life (all adults) | 4.75% | 0.10% |
Spend&Save (ages 18-34) | 5.50% | 0.10% |
Source: Canstar. Note: conditions for bonus interest vary between the two accounts.
Canstar’s data insights director, Sally Tindall, says, “CBA, Westpac and ANZ were quick to follow NAB in delivering the news no variable borrower wants to hear: their mortgage rate is on the rise.”
She added: “Between surging grocery bills, skyrocketing petrol prices, the end of electricity rebates and rising health insurance premiums, household budgets could well be breaking at the seams on the back of this news.
“When banks pass on the March hike, a typical $600,000 mortgage with 25 years remaining could see $91 added to monthly repayments. Combined with the February increase, that’s $181 extra per month these borrowers will need to cover.
“If you’re starting to feel the strain, the worst thing you can do is stay silent. Banks have a legal obligation to help, but you need to reach out early.
“Switching to interest-only or extending your loan term can offer short-term relief, but they come at a long-term cost. What eases your budget now may add thousands in interest later.
“These options should be treated as a lifeline, not a lifestyle – they’re there to help you through a rough patch, not as a permanent solution.
“On the savings side, Westpac is passing on a 0.25 percentage point increase to both its Life and Spend&Save accounts, but only for customers who meet the monthly conditions.
“This move, when effective, will take the Westpac’s Spend&Save account to a maximum rate of 5.50 per cent – the highest ongoing savings rate in the market.
“However, once again, the fine print is set to trip some customers up, because those who don’t meet the conditions will find they’re earning just 0.10 per cent.
“The other three big banks haven’t said anything about savings rates – creating an unfortunate waiting game that keeps loyal savers in limbo.
“Keep an eye on your savings rates – not just the headline figure but what you’re earning on an ongoing basis, and if your bank doesn’t do right by you, it could be time to take your nest egg shopping.”
