Your Fixed Rate Is Expiring in 2026: What to Do Before It Rolls Over

Overview

Billions of dollars in fixed-rate home loans are continuing to roll over to variable rates throughout 2026. If your fixed term is ending soon, taking action before expiry could save you thousands of dollars per year.

The Revert Rate Trap

When your fixed rate expires, your loan automatically moves to your lender's revert rate — typically the standard variable rate, which is almost always higher than the best available variable rate. The difference can be significant.

For example, on a $500,000 mortgage, falling onto the revert rate instead of negotiating a competitive variable rate can cost an extra $1,000 per month in unnecessary interest.

On a $700,000 loan, the jump from a 2% fixed rate to a 6.6% variable rate increases monthly repayments from approximately $2,967 to $4,770 — an increase of over $1,800 per month or nearly $22,000 per year.

What Are Your Options?

1. Negotiate a Better Variable Rate

Contact your current lender and ask for their best available variable rate. Banks typically offer better rates to customers who ask, especially if you have a good repayment history. Mention competitor rates to strengthen your position.

2. Refinance to a New Lender

If your current lender won't match the market, consider refinancing. Switching lenders can save 0.5-1.0% on your rate, which on a $500,000 loan is $2,500-$5,000 per year in interest savings.

Use our Loan Comparison Calculator to compare your current deal against alternatives.

3. Fix Again

You can re-fix your rate for another 1-5 year term. This provides certainty but means you miss out if variable rates fall. In the current environment where further rate rises are possible, fixing provides a hedge against increases.

4. Split Your Loan

Fix a portion and leave the rest variable. This gives you certainty on part of your repayments while retaining flexibility (offset account, extra repayments) on the variable portion.

When to Act

Experts recommend contacting your lender or broker at least two months before your fixed rate expires. This gives you time to:

• Get your current lender's best offer
• Compare alternatives in the market
• Complete any refinancing paperwork before the fixed term ends
• Avoid defaulting to the expensive revert rate

How to Compare Effectively

1. Check your current revert rate — ask your lender what rate you will move to when the fixed term ends
2. Get your lender's best offer — ask what competitive rate they can offer to retain you
3. Compare the market — check 2-3 other lenders for their best rates
4. Factor in all costs — refinancing may involve discharge fees ($150-$400), application fees, and potentially break costs if leaving early
5. Calculate total savings — use our Loan Comparison Calculator to model the full picture

Use Our Calculators

• Mortgage Repayment Calculator — see how different rates affect your repayments
• Loan Comparison Calculator — compare two loan options side-by-side
• Extra Repayments Calculator — see how extra payments or an offset account can reduce your interest

Compare loans: Loan Comparison Calculator | Calculate repayments: Mortgage Calculator.

Sources: Loan Market, Home Loan Experts, Canstar, Mortgage Professional Australia.