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How long does it take for an interest rate rise to kick in?

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Household budgets around the country are feeling the brunt of five back-to-back rate hikes. And we’ve been warned more are on the way. But just how long does it take for each rate rise to impact your monthly mortgage repayments?

When will my variable rate rise kick in?

As you know, the Reserve Bank of Australia (RBA) has been raising the cash rate in recent months. This has led to an increase in variable interest rates for home loans.

But when exactly does your variable rate rise kick in?

There is a lag time between when the RBA raises the cash rate and when your lender increases their variable interest rates. This is because lenders need to give you some notice before they can increase your repayments.

The amount of notice that lenders give you varies from bank to bank. For example, CBA gives 20 days' notice, Westpac gives 30 days' notice, NAB gives 32 days' notice, and ANZ gives 30 days' notice.

So, if the RBA raises the cash rate on October 4, your lender may not increase their variable interest rates until November 6. This is because they need to give you 30 days' notice before they can increase your repayments.

What can I do to prepare for a rate rise?

There are a few things you can do to prepare for a rate rise.

First, you can check your current interest rate and see if you could get a better deal elsewhere. You can use a comparison website to compare interest rates from different lenders.

Second, you can start saving money now so that you have a buffer in case your repayments increase. This will help you avoid having to make any drastic changes to your budget if your rates do go up.

Third, you can consider refinancing your home loan. This could save you money on your interest payments in the long run.

What if I can't afford my repayments?

If you're worried that you won't be able to afford your repayments after a rate rise, there are a few things you can do.

First, you can contact your lender and see if they can offer you some flexibility. For example, they may be able to extend the term of your loan or lower your interest rate.

Second, you could consider selling your home. This may not be ideal, but it could be the only option if you're struggling to make your repayments.


A rate rise can be a stressful time, but there are steps you can take to prepare. By knowing when your rate rise will kick in and taking steps to save money, you can minimize the impact on your finances.

Here are some additional tips for dealing with a rate rise:
  • Contact your lender as soon as possible after the RBA raises the cash rate. This will give you time to discuss your options and make any necessary changes to your loan.

  • Review your budget and see where you can cut back. This could mean eating out less, canceling unnecessary subscriptions, or finding ways to save on your energy bills.

  • Consider consolidating your debt. This could help you reduce your monthly repayments and free up some extra cash each month.

  • Don't panic. A rate rise is a temporary event, and your finances will eventually recover. In the meantime, focus on making your repayments and taking steps to protect your financial future.

Want to learn more? Talk to our brokers today!

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.


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