The Reserve Bank of Australia kept the cash rate at 4.35% at its August meeting on Tuesday 11 August 2026. After three rate rises earlier this year, most households will read that as a reprieve, and it is. But a hold is not the same as relief. Repayments that jumped through February, March and May are still exactly where they were, and for many Geelong, Bellarine and Melbourne borrowers the more pressing question is not “what did the RBA do?” but “why does it still feel this hard, and what can I actually do about it?”
In the lead-up to the meeting we published a guide to preparing for the August decision. This is the follow-up now the result is in: what was decided, what it means for different types of borrowers, and (the part the national explainers mostly skip) what to do if you feel locked into your current loan. As always, the figures below are drawn from published sources as at 12 August 2026; rates and lender policies change constantly, so confirm current numbers with the RBA, your lender or your broker before acting.
The decision itself held few surprises. Financial markets had all but ruled out another increase, and 92% of the economists and experts surveyed by Finder expected the RBA to stay on hold. The reason is inflation: reported figures show headline inflation easing to around 3.8% in the June quarter, down from about 4.0%, with underlying (trimmed mean) inflation at roughly 3.6%. Inflation is still above the RBA’s 2-3% target band, but it came in below what the Bank had been forecasting: enough to justify a pause while the earlier hikes keep working through the economy.
Context matters here. The cash rate sits at 4.35% because the RBA lifted it by 0.25 percentage points three times in 2026: in February, March and May. Those increases were the sting in the tail of an inflation fight most people hoped was over, and they are the reason mortgage stress conversations picked up again this winter. Reported figures put the average new owner-occupier variable rate at around 6.25% p.a., though actual rates vary widely between lenders and borrowers, which is precisely why a rate review is worth doing. For a longer view of where rates may head from here, see our Australian interest rate forecast for 2026. The next RBA meeting is scheduled for 29 September 2026.
A hold lands differently depending on where you sit. Here is the practical read for the main borrower types we work with across Geelong, the Surf Coast, Melbourne and Australia-wide:
| Your situation | What the August hold means | Smart next step |
|---|---|---|
| Variable-rate owner-occupier | No change to repayments, but you are still carrying all three 2026 increases | Ask your lender for a repricing review; compare against the market via a refinance assessment |
| Fixed rate expiring soon | The revert rate you roll onto reflects the post-hike market: the “cliff” is real but plannable | Start comparing 2-3 months out; weigh up fixed vs variable before you roll |
| Property investor | Stable rates make holding costs predictable while prices soften | Review structure and rates across the portfolio; investor margins vary a lot between lenders |
| Buyer with pre-approval (or about to apply) | Borrowing power steadies when rates stop rising, and spring listings are around the corner | Get or refresh pre-approval so you can move quickly in September |
That is the combined size of the February, March and May increases now baked into variable rates. As simple arithmetic, 0.75 percentage points on a $600,000 loan balance is roughly $4,500 a year (around $375 a month) in additional interest, before fees or compounding. Your actual figure depends on your balance, rate and structure; the point is that the hold freezes that extra cost in place rather than removing it.
Here is the conversation we are having most often this month. A borrower knows they are paying more than the market rate. They want to refinance. But when a new lender assesses them, the numbers fail: because lenders do not assess you at today’s rate. Under APRA’s long-standing guidance, lenders typically add a serviceability buffer of around 3 percentage points on top of the loan rate when testing whether you can afford the repayments (the exact buffer setting can change; your broker can confirm what applies right now). After three hikes, being tested at roughly 9% or more is a bar some perfectly reliable payers cannot clear on paper. Add the softer property prices we covered in our negative equity guide (which shrink your usable equity) and you get what the industry calls a mortgage prisoner: someone stuck on an uncompetitive rate because they cannot pass the test to leave.
If that is you, the worst response is resignation. In practice there are several levers, roughly in order of effort. First, repricing: your existing lender does not need to re-run serviceability to give you a better rate on the loan you already have, and a well-argued repricing request (ideally made by your broker, with competitor pricing attached) is often the fastest win. Second, restructuring: extending the remaining term, moving to interest-only for a period, or making better use of an offset account can ease monthly cash flow, each with trade-offs a broker should walk you through. Third, targeted refinancing: lender policies differ far more than most people realise, and at various times some lenders have applied reduced serviceability buffers to like-for-like (“dollar-for-dollar”) refinances for borrowers with clean repayment history; availability changes, so this is squarely a check-with-your-broker item. Fourth, consolidating expensive short-term debts can improve the serviceability calculation itself, used carefully, because stretching short-term debt over 30 years has costs of its own.
A couple in Lara came to us convinced they were trapped. They had bought in 2021, watched their repayments climb through this year’s three hikes, and had been declined for a refinance because the new lender’s assessment rate pushed them past their limit on paper. We took a three-step path instead. Step one was a repricing request to their existing bank, supported by written comparison rates from competitors: that alone secured a meaningful discount without any new application. Step two was restructuring their car loan and credit card, which had been quietly dragging down their serviceability. Step three, planned for later this year once those changes season, is a full refinance assessment: because with cleaner liabilities and a sharper rate already banked, the same couple now clears hurdles they failed three months ago. Nothing exotic; just sequencing the moves in the right order.
Rate pauses are planning windows. Between now and the RBA’s next meeting on 29 September 2026, three things are worth doing regardless of which way the next decision goes. Check the rate you are actually paying (not the rate you think you are paying) against what your lender offers new customers; the gap is often the single easiest saving in your budget. If your fixed rate expires in the next six months, get ahead of the rollover now rather than accepting the revert rate by default. And if you are planning to buy this spring selling season (in Geelong, Armstrong Creek, Torquay, Ocean Grove or anywhere across Victoria) a current pre-approval turns a stable-rate environment into a genuine advantage, because you know your budget will not be moved underneath you mid-search. Our home loans team works with clients across Australia, with deep local knowledge of the Geelong, Bellarine and Surf Coast markets.
Before you apply anywhere new, ask your current lender to reprice: in writing, with evidence of competitor offers. Lenders keep their sharpest rates for new customers and quietly leave loyal ones on higher pricing, but most have a retention team whose whole job is stopping you from leaving. A broker-managed repricing request costs you nothing, involves no credit check, and sets the benchmark any refinance then has to beat. Our free refinance assessment covers both paths in one review.
No. At its meeting on 11 August 2026 the Reserve Bank held the cash rate at 4.35%. The hold follows three 0.25 percentage point increases earlier in 2026 (in February, March and May) and was widely anticipated after reported inflation figures came in softer than the RBA’s forecasts. The next scheduled meeting is 29 September 2026.
A hold means variable repayments stay where they are, including the increases already passed through from this year’s three hikes. Fixed-rate borrowers are unaffected until their fixed term ends, at which point they roll onto a rate that reflects the current market. Either way, the decision itself does not lower anyone’s repayments; only a rate cut, a repricing win or a refinance does that.
A mortgage prisoner is a borrower who cannot refinance to a cheaper loan because they no longer pass a new lender’s serviceability test (typically assessed at around 3 percentage points above the actual loan rate under APRA guidance) or because falling property values have eroded their equity. The tell-tale signs: you have been declined for a refinance, or a broker or lender has told you your borrowing capacity is below your current loan balance. It is common after rapid rate rises, and it is often fixable through repricing, restructuring or targeted lender selection.
There is no universal answer: fixed rates already price in the market’s expectations of future RBA moves, so waiting for a decision rarely delivers a free kick. The better question is what certainty is worth to your household budget: fixing suits borrowers who value predictable repayments, while variable (or a split loan) suits those who want flexibility and offset access. Compare current fixed and variable offers side by side with your broker before the spring rush, and read our fixed vs variable guide for the full trade-offs.
Whether you want your current rate benchmarked, a repricing request run against your lender, or a full refinance strategy before the RBA’s September meeting, we will review your position properly, with no obligation and no impact on your credit file.
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.
