What happened
Expiring multi-year fixed-rate mortgages are automatically rolling onto lenders' higher variable revert rates. On a $600,000 loan finishing a five-year fixed term, monthly repayments can jump by over $1,000. Lenders typically send expiry notices six to eight weeks beforehand, but revert rates often exceed discounts offered to new customers.
Why it matters here
With interest rates remaining elevated, repayment shock reduces discretionary household spending across Australia. Property investors and homeowners who fail to act risk paying uncompetitive revert rates. Financial modelling shows re-fixing only outperforms variable loans if market interest rates increase by 0.30% or more shortly after the fixed period ends.
What to watch
Lender revert rate statements received 90 days before loan expiry dates, along with competitive variable interest rate offers available across Australian mortgage lenders.
Source
unconditionalfinance.com.au