There’s a letter that lands in thousands of Australian letterboxes and inboxes every month: “Your fixed rate period is coming to an end.” If yours has arrived (or is due to), you’re facing one of the most consequential five-minute decisions in your financial year. Borrowers across Geelong, the Bellarine, Torquay, Melbourne and right around the country are rolling off fixed terms in 2026 into a rate environment that looks nothing like the one they locked in under.
The good news: the rollover moment is also the single best point of leverage you’ll get with your lender. Handled early and deliberately, it’s when discounts are won, loans are restructured and thousands of dollars a year change hands. Handled passively, it’s when your loan quietly reverts to a rate you never agreed to pay. Here’s how to make it the former.
The RBA raised the cash rate three times earlier in 2026 before pausing, and in August the Monetary Policy Board held it at 4.35%. That means anyone who fixed their rate one, two or three years ago, when the cash rate was lower, is rolling off into a market that has moved against them. Variable rates offered today reflect this year’s hikes, and lenders’ revert rates sit above their sharpest advertised offers.
What happens next is uncertain, and it pays to be honest about that. The RBA raised the cash rate again at its 29 September 2026 meeting, and the big banks differ on whether more rises are coming. The disagreement stems from inflation data: reported headline CPI of 3.5% for July, with trimmed mean inflation around 3.6%, still above the RBA’s 2 to 3% target band. Forecasts change quickly, so treat any prediction (including these) as context, not certainty, and check the current position before you commit. We unpacked the August decision in detail in our guide to what the RBA’s 4.35% hold means for your mortgage.
For a borrower coming off a fixed rate, that uncertainty cuts both ways: roll to variable and your rate could rise again before it falls; fix again and you may lock in near the top of the cycle. That’s exactly why the decision deserves more than the default option.
Unless you act, nothing dramatic happens, and that’s the trap. On the day your fixed period expires, your loan automatically rolls onto your lender’s revert rate, usually its standard variable rate or a close cousin of it. No new application, no signature, no negotiation. The revert rate is typically noticeably higher than the rates the same lender advertises to win new customers. Comparison site reporting in August 2026 noted dozens of lenders offering at least one owner-occupier variable rate below 6%, even as many revert rates sit well above that. Your repayments are recalculated at the new rate, and any fixed-period restrictions (like limits on extra repayments) fall away.
Because everyone’s loan size, remaining term and old fixed rate differ, the honest way to show the stakes is arithmetic, not advertised rates. The table below is pure illustration: monthly principal-and-interest repayments on a 25-year remaining term at a range of possible rates. It is not a quote and none of these are today’s advertised rates; use it to see how sensitive your repayment is to the rate you land on, then get real figures for your loan.
| Loan balance (25 yrs remaining) | At 5.49% p.a. | At 5.99% p.a. | At 6.49% p.a. | At 6.99% p.a. |
|---|---|---|---|---|
| $500,000 | ≈ $3,067/mth | ≈ $3,218/mth | ≈ $3,373/mth | ≈ $3,531/mth |
| $650,000 | ≈ $3,988/mth | ≈ $4,184/mth | ≈ $4,385/mth | ≈ $4,590/mth |
| $800,000 | ≈ $4,908/mth | ≈ $5,150/mth | ≈ $5,397/mth | ≈ $5,649/mth |
Illustrative arithmetic only, principal-and-interest over 25 years, excluding fees. The pattern to notice: on a $650,000 balance, every half a percentage point is roughly $200 a month, about $2,400 a year. Landing half a percent lower than the revert rate isn’t a rounding error; it’s a school term of fees, a chunk of your offset, or a year of rego and insurance.
The gap between the average rate paid on outstanding variable loans and the average rate on new variable loans, as reported in the RBA’s May 2026 Bulletin (data to March 2026). Why so small? Because in recent years a huge number of borrowers refinanced or negotiated. The borrowers who act get new-customer pricing, while those who don’t quietly subsidise them. Rolling off a fixed rate is your natural moment to be in the first group.
1. Do nothing and revert. Zero paperwork, and occasionally defensible, for example if you’re about to sell the property or discharge the loan anyway (our mortgage discharge guide covers that process). For almost everyone else, the revert rate is the most expensive option available.
2. Negotiate with your current lender. One phone call (or one call from your broker) asking a simple question: “What rate are you offering new customers with my loan size and equity, and can I have it?” Lenders have retention teams precisely because they’d rather reprice you than lose you. The RBA’s own analysis shows negotiation works at scale. No exit costs, no new application, often same-week results.
3. Refinance to a new lender. More effort, biggest potential payoff, and the rollover is the cheapest time to do it, because you have no fixed-rate break costs once the term ends. A refinance is also the moment to fix structural problems: adding an offset, splitting the loan, consolidating a car loan or card, or shortening the term. Our 2026 refinancing guide walks through costs, timing and traps, and our free refinance assessment will tell you whether switching actually beats staying.
4. Re-fix, or split the loan. Fixing again buys certainty on repayments (valuable if your budget is tight), but you’re locking in at today’s pricing, in a market where even the major banks disagree about the next move. A split loan (part fixed, part variable) hedges the bet and keeps offset and extra-repayment flexibility on the variable portion. The right mix depends on your buffer, your plans and your tolerance for surprises; our fixed vs variable guide for 2026 goes deeper, and offset vs redraw explains the features worth keeping.
Picture a couple in Ocean Grove whose two-year fixed term on their family home ends in October 2026. Their lender’s letter offers the revert rate, plus a menu of re-fix options, and the path of least resistance is to tick a box. Instead, three months out, they get their loan reviewed. The review finds their equity has improved since they last applied (years of repayments, even in a soft market, have lowered their loan-to-value ratio), which qualifies them for sharper pricing tiers. Their broker asks their existing bank for its new-customer rate; the bank sharpens its offer, but a competitor’s package with a full offset account beats it. They split the new loan (part fixed for certainty, part variable with the offset absorbing their savings), and their monthly position lands materially better than the revert path, with structure they chose rather than defaulted into. The figures differ for every household; the sequence (start early, check your equity, make lenders compete) is the repeatable part.
90 days out: Find your exact expiry date and your revert rate (it’s in your loan documents or your banking app). Order your last few statements and check your current balance, remaining term and estimated property value. Your loan-to-value ratio drives the pricing you can access, as our LVR guide explains.
60 days out: Get a comparison done across the market, not just your own bank’s re-fix menu. This is where a broker earns their keep: one conversation, dozens of lenders’ pricing and policies, including lenders whose retention pricing beats their advertising.
30 days out: Make the decision and lodge it. A repricing request takes days; a refinance typically needs a few weeks to settle. Moving now means the new arrangement starts the day the fixed term ends, and the revert rate never touches your loan.
Expiry day: Confirm the new rate or loan is active, then set a calendar reminder to review it again in 12 months. Rate reviews are a habit, not a one-off, especially with the RBA’s path from here contested.
If your lender offers to re-fix, ask for the comparison rate and the revert rate at the end of the new fixed term, not just the headline rate, and ask whether the fixed portion allows extra repayments and to what limit. Two fixed offers with the same headline rate can behave very differently when your circumstances change. And if you’re rolling off around an RBA meeting date, be aware that fixed pricing can move in the days around it; a rate-lock at application can matter as much as the rate itself.
Your loan automatically rolls onto your lender’s revert rate (usually its standard variable rate), and your repayments are recalculated at that rate. There’s no penalty and no paperwork, but revert rates are typically higher than the rates the same lender offers new customers, so doing nothing usually means paying more than you need to. Check your revert rate before your term ends so the new repayment isn’t a surprise.
It depends on what you’re buying with the fixed rate: certainty. The RBA raised the cash rate after holding it at 4.35% in August 2026, and the major banks differ on whether more rises are coming. Fixing protects your budget if rates rise but locks you out of falls and usually restricts offsets and extra repayments. Many borrowers land on a split loan (part fixed, part variable) as a middle path. There’s no universally right answer; get advice on your numbers.
You can refinance during a fixed term, but the lender may charge break costs, which can be substantial and vary daily with market movements. Once the fixed term ends, break costs no longer apply, which is why the rollover date is the natural, cheapest window to switch. The practical approach is to start comparing about 90 days before expiry and time the new loan’s settlement to land at or just after the rollover.
Generally no. The revert rate is a default, not an offer. Sharper pricing usually has to be requested, either by you or by a broker on your behalf. RBA analysis published in May 2026 found the average gap between what existing and new variable borrowers pay had narrowed to only a few basis points precisely because so many borrowers refinanced or negotiated in recent years. Lenders respond to borrowers who ask; the rollover is the moment your request carries the most weight.
We’ll check your revert rate, ask your lender the questions that move pricing, and compare your loan against the market, for borrowers in Geelong, the Bellarine, Torquay, Melbourne and Australia-wide. No obligation, plain English, and ideally 90 days before your rollover date.
With years of experience in mortgage broking and finance, Melanie helps first home buyers, refinancers, investors and business owners across Geelong, the Bellarine, the Surf Coast, Melbourne and regional Victoria make their money work harder. Contact our team on 03 9020 2699.
