Published 18 Feb 2025 by Cheryl Hayford
The Reserve Bank of Australia (RBA) has announced a cut to the official interest rate, bringing it down to 4.1%. This is the first rate reduction since 2020, and for many Australians, this is welcome news.
At MyBudget, our office is buzzing with excitement as this change brings significant relief to homeowners. But what does this mean for you and your mortgage repayments?
If you have the average-sized mortgage in Australia, this rate cut could mean a reduction of $90 to $100 per month on your home loan repayments. While this might not seem like a massive amount, over the course of a year, it adds up to substantial savings.
With this interest rate cut, homeowners have two main options:
1. Enjoy the savings: reduce your monthly mortgage repayments and ease the strain on your budget.
2. Keep your repayments the same: by maintaining your current repayment amount, you can pay off your mortgage faster and save on long-term interest.
Understanding how this rate cut affects your finances is crucial. Use the MyBudget Mortgage Repayment Calculator to work out exactly how much you could save or how quickly you could pay down your loan by keeping repayments steady.
This is the first interest rate cut since 2020, making it a significant moment for the Australian housing market. For many borrowers who have been grappling with rising rates over the past few years, this reduction brings much-needed relief.
The interest rate landscape is always changing. Whether you’re a first-time homebuyer or managing an existing mortgage, staying on top of RBA decisions and Australian interest rates is essential for smart financial planning.
Use this opportunity to reassess your budget, make informed decisions, and take control of your financial future.
This article has been prepared for information purposes only, and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information in this article you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.
Imagine where your finances could be 12-months from now.
This page provides general information only. It does not take your personal circumstances into account and is not personal financial advice. For the scope and licensing of a particular service, check the service provider's current disclosures or contact MyBudget.
To talk through your own situation, call MyBudget on 1300 300 922 for a free, confidential, no-obligation appointment.