Business · Economy · 6 hrs ago
Australian borrowers turn to refinancing as mortgage rates rise
Australian households are facing mortgage rates at their highest in 18 years as they look for ways to manage rising costs.
Loan Market says refinancing increased 7% in the month to the end of October, and it expects more borrowers to seek new deals.
In 2023, some borrowers could get better terms simply by telling their bank they planned to leave, but banks are now more likely to wait until customers have begun the discharge process.
Refinancing already makes up about 57% of new lending at banks, as higher rates and a weaker property market limit other borrowing.
After a recent Reserve Bank rate rise, average rates were 6.74% for owner-occupiers and 6.97% for investors, while one in 10 borrowers surveyed said they could not meet higher repayments.
Borrowers are advised to ask their current bank for a better deal first, then consider switching if the loan remains uncompetitive.
Australian mortgage refinancing is expected to increase as rates reach their highest level in 18 years and households seek to ease cost pressures.
Loan Market reported a 7% month-on-month rise in customers refinancing mortgages to the end of October.
Its head of content, Shay Waraker, said major banks are waiting until borrowers complete mortgage discharge before trying to win them back.
Canstar said average mortgage rates for owner-occupiers were 6.74% and for investors 6.97% after the latest Reserve Bank rate rise.
A Canstar survey found one in 10 borrowers would be unable to meet higher repayments, while a further 28% said they would struggle.
- Who
- Australian mortgage borrowers are refinancing, while banks compete to retain or attract customers.
- What
- Refinancing is expected to rise as borrowers respond to higher mortgage rates and household cost pressures.
- When
- Loan Market reported a 7% month-on-month increase to the end of October. The article was published on 10 November 2026.
- Where
- Australia.
- Why
- Borrowers are seeking ways to ease costs as mortgage rates rise and repayments increase.
This story does not have two clearly opposing sides.
During an earlier refinancing wave, some borrowers obtained better loan terms by asking their bank for a mortgage discharge authority.
Loan Market recorded a 7% month-on-month increase in customers refinancing mortgages.
The Reserve Bank raised its rate, after which Canstar said average mortgage rates were 6.74% for owner-occupiers and 6.97% for investors.
- Mortgage rates
- Highest level in 18 years
- Refinancing increase
- 7% month-on-month to the end of October
- New lending
- About 57% was refinancing
- Owner-occupier average rate
- 6.74%
- Investor average rate
- 6.97%
- Repayment increase
- About $456 a month for a $600,000 mortgage compared with the start of the year
What people are saying
What we are hearing from our brokers is that the big banks are now waiting to see if a customer is serious about quitting their loan
They will wait until their clients have actually completed a mortgage discharge and only then make efforts to reclaim them for the bank with a better deal.
I think we are going to see more people trying to free up cash to avoid making drastic decisions
Five rate hikes in a single year is a significant hit to household budgets. For someone with a $600,000 mortgage, repayments are now set to be around $456 a month higher than they were at the start of the year.