Introduction
The Reserve Bank of Australia (RBA) has entered a rate-cut cycle, offering long-awaited relief for borrowers. But here’s the catch: not all banks are passing on the savings in full — and some are delaying the reductions for weeks.
For homeowners and first home buyers in Sydney, Melbourne, Brisbane, Perth, Adelaide, Hobart, Canberra, and Darwin, this means you may not be enjoying the full benefit of the RBA’s decision. The difference could be thousands of dollars each year.
What the RBA Has Announced
- The RBA has cut the cash rate to stimulate growth and ease pressure on borrowers.
- According to recent reports, if the cut is passed on in full, the average variable rate should fall to around 5.54%.
- Yet analysis shows many banks are either only partially passing on cuts or delaying them altogether.
How Much Could You Be Missing Out On?
Let’s say you have a $600,000 loan:
- At 6%, monthly repayments = $3,865
- At 5.54% (average if cuts are passed on) = $3,678
- If your bank only cuts half the amount, you could still be paying around $3,775/month
That’s nearly $100 a month ($1,200/year) left in your bank’s pocket — not yours.
Capital City Realities
- Sydney: High loan balances mean partial cuts cost borrowers thousands each year.
- Melbourne: Competition is fierce — many non-major lenders pass cuts on faster than the big four.
- Brisbane: First home buyers benefit from switching lenders who act quickly.
- Perth: Strong equity growth gives refinancers leverage to demand better deals.
- Adelaide: Smaller loans still feel the sting of banks not passing full cuts.
- Hobart: Borrowers risk overpaying if loyalty to big banks keeps them from reviewing.
- Canberra: Stable incomes = stronger negotiation power with lenders.
- Darwin: Regional lenders may offer more competitive timelines for applying cuts.
Why Banks Don’t Always Pass Cuts On
- Profit Margins – Banks protect revenue by delaying reductions.
- Market Segmentation – Some lenders cut aggressively to attract new customers while neglecting existing ones.
- Operational Delays – Excuses like “system updates” create lag.
The Role of Brokers in Holding Banks Accountable
Mortgage brokers play a critical role in ensuring borrowers actually benefit from RBA decisions:
- Review your current rate immediately after RBA announcements.
- Compare 50+ lenders to identify those passing cuts on quickly.
- Negotiate with your current lender using competitor offers.
- Switch you to a better deal if your bank drags its feet.
Real Client Story: Daniel in Sydney
“After the RBA cut, my bank only reduced my rate by 0.15%. My broker found another lender who passed on the full 0.25%. I refinanced, and now I’m saving $120/month.”
Don’t Assume Loyalty Pays
Banks rely on borrower inertia. They know most customers won’t switch even if they’re being short-changed. But with cashback offers, sub-5% fixed rates, and competition heating up, the cost of staying loyal is higher than ever.
What to Do Next
- Check Your Rate – Compare it with market-leading rates after each RBA cut.
- Ask Your Bank – Are they passing on the full cut? When?
- Consult a Broker – If not, a broker can help you switch quickly.
📅 Book Your Free, No-Obligation Chat
At Money Tree Mortgage Brokers, we don’t just watch the RBA — we watch the banks too. Our job is to make sure you get the full benefit of rate cuts by comparing 50+ lenders, negotiating on your behalf, and securing real savings.
Don’t let your bank pocket what should be yours.
