How 3.3 million home owners should feel about rate rises… (24/03/2026)

As I am a mortgage owner myself, I can tell you I haven’t had a direct debit on one of my loans in more than a decade and when the reserve bank ups and downs the rate, I dont even check on my loans. My 30 year home loan will be paid off in less than 10 and I am not beholden to interest rates.

There is a lot of talk among my clients at the moment about fixing their interest rate, and although I think that this consideration is essential in this market, I would rather be talking with my clients about how they can get themselves in charge of their home loans, and be immune to the fluctuation of rates at the Reserve Bank.

The price of your home loan changes more than the supermarket changes the price on milk, and yet almost everyone sets their repayment for their housing loan at the minimum amount payable because they want to have enough money left over the the rising cost of living.

What if you sent your cost of living, stuck to a strict budget, made buying adjustments and allowed your home loan to be the part of your budget that fluctuated without adjustment to repayments?

What do I mean by this? Well, when you take a home loan today, most banks are assessing if you can afford that loan if interest rates went to say 9-9.5%. So, based on the information you have provided them, you are in fact able to pay repayments at this higher rate. (For the record, I haven’t seen a home loan rate this high in nearly 20 years)

What if you asked your mortgage broker what the repayment would be at the higher rate and then paid that? For example :

A standard mortgage at 6.00% for 30 years has a repayment of $2,398.70 per month.

If that interest rate rose straight away to 9.00% then the repayment would increase to $3,218.70 per month.

If you paid $3,218.70 from day 1 and the rate stayed the same, then you would pay the loan off in less than 17 years and save over $235,000 in interest alone. Pay more when you can and increase your savings, and pay ‘less off the loan’ when the rates increase but still be well ahead of the game.

In a nutshell, don’t let the bank dictate what your repayment is because thats how they make an extra $235,000+ off this above scenario. Work with your broker on how to reduce the interest, own your home sooner and move in to the investing, self servicing space as soon as possible.

This is the kind of mortgage advice we provide. Reach out and set an appointment if we can help you more.