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Do repayments auto-adjust after an RBA cut, and do banks even pass it on?
Bayley Clarke · Mortgage broker on the road · Last checked 3 September 2026 · 3 min read
The short answer
Often, no. Your minimum repayment only reduces when the bank changes the terms of your contract, and for most banks that means you have to call and ask.
It sounds backwards, but it's deliberate. You may not want the lower repayment. If you're comfortable paying what you're paying now, leaving it alone after a cut means less interest over the life of the loan and a loan that's gone sooner. The bank moves a lot quicker the other way.
The one minute version. The rest of this page is the detail underneath it.
Why the repayment doesn't move on its own
Repayments often will not automatically adjust when there is a rate cut, because it requires your minimum repayment to actually reduce. And for your minimum repayment to reduce, generally you need to call your bank to make that happen. They're changing the terms of the contract in reducing your repayment for you.
The reason they don't just do it is that you may not actually want to reduce your repayment. Plenty of people don't. So the bank leaves the direct debit where it is, and the lower rate shows up as extra money going into your loan instead of extra money in your account.
When you should leave it exactly where it is
The biggest thing when we get rate cuts is this. If you're interested in minimising how much interest you pay over the life of the loan, and making sure it's paid off sooner rather than later, and you're comfortable paying what you're paying now, then just keep it the same.
On a $500k loan, keeping the old repayment after a cut can quietly take years off the term, because every dollar above the new minimum is going straight at the principal. You're not doing anything clever. You're just not spending a pay rise you didn't ask for.
When you should make the call
If cash flow is tight and the lower minimum makes a real difference to the month, ring the bank and have the repayment reduced. That's what the cut is for. There's no penalty for asking, and it's a ten minute call.
One thing to check while you're on the phone: whether the cut was passed on in full. Not every bank moves the full amount, and not on the same day. If yours didn't, that's the start of a repricing conversation, not something to accept.
The honest bit: watch the other direction
What's funny is that on the flip side, the banks are very eager to increase your rate and your minimum repayment when there is an RBA rate rise. That one doesn't need a phone call. It just happens.
So the asymmetry is real. Cuts need you to act, rises don't. It's another reason I review every client's loan every three months rather than waiting for the bank to tell us anything.
Want to know if your bank actually passed the cut on?
A 30 minute call. I look at what you're paying now against what the same bank is offering new customers, and against the market, and tell you whether it's a phone call to your bank or a bigger conversation.
No cost to you. The bank pays me when a loan settles. ยท How I get paid
Next question
Repricing versus refinancing: which one should I do first?If the cut didn't fully land, this is the order of operations.
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